Norway’s ethics watchdog, the Council of Ethics, has issued an early warning to cryptocurrency sites, gambling operators, and even shoemakers who are planning to assess companies for regulatory compliance. The call-up is part of the Norwegian sovereign fund’s commitment to ensure that its holdings are only in ethical companies and have complied with the rules set by the Norwegian parliament.
According to a Reuters report, the Council of Ethics will launch the review next year and examine its portfolio. If the Council’s concerns about ethical breaches are confirmed, the fund may decide to put these companies on the watchlist or even divest from them.
Norwegian Wealth Fund Plans Portfolio Review
The Goverment Pension Fund Global of Norway is one of the world’s largest government wealth funds, with over $1.8 trillion in assets in management. Norway’s sovereign wealth fund was designed to manage the country’s surplus income from the gas and oil industries and promote financial stability that can sustain the next generation through investments.
As the largest sovereign fund, the Government Pension Global Fund owns 1.5% of all listed shares in roughly 8,700 companies worldwide. Next year, these companies will be the subject of an ethics inquiry, and if they fail to comply, the fund may decide to divest from them.
Total crypto market cap at $3.33 trillion on the daily chart: TradingView.com
Asia’s Shoe Factories Among Those Under Possible Investigation
The Council plans to examine the operations of shoe factories in Asia in addition to crypto firms and gambling operators. Asia-based shoe factories have been under investigation over their questionable labor practices for decades, including low pay, long hours, and union rights.
According to a document forwarded to the Finance Ministry on October 10th, the Council will examine the work conditions of several shoe companies. The plan also explained that companies are responsible for ensuring that workers’ rights are protected, and if there are breaches and non-compliance, they can be delisted from the fund.
Exclusion Of Big Companies
Currently, the country’s fund has excluded 189 companies, including Boeing and Airbus, two of the world’s biggest commercial plane makers. The fund also uses other criteria in selecting investments, including possible human rights violations, corruption, and environmental damage. Crypto companies and gambling operators will also be subjected to checks due to the risk of money laundering.
The fund invests in globally recognized companies such as Nike and Adidas. It has a 0.9% stake in the latter, worth $1 billion, and it also invests in Puma, worth $1.5 billion.
Adidas recently announced that it’s protecting workers by promoting safe and ethical working conditions. The company added that it had recently conducted over 1,000 factory audits.
Featured image from Business Norway, chart from TradingView
