Norway’s $870 billion sovereign wealth fund has excluded four Asian companies over environmental concerns linked to their palm oil activities in Indonesia.
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Palm oil, a widely-used processed food ingredient, has been widely criticized for harming the environment due to deforestation and the related production of massive quantities of methane, a greenhouse gas that is 34 times more potent than carbon dioxide.
Construction strong IJM Corp Bhd and company Genting Bhd, both Malaysia, and steelmaker POSCO and company Daewoo worldwide Corp of South Korea, were usually taken out of the fund.
Earlier this year, the Norwegian parliament approved plans to sell off billion in coal investments as it divests from fossil fuels.
“The Executive Board has not conducted an independent assessment of all aspects of the recommendations, but is satisfied that the exclusion criteria have been fulfilled”, GPFG, a fund managed by Norges Bank, said.
Those moves by the fund – which draws investment money from Norway’s huge oil revenues – are frequently replicated by other worldwide investors concerned about ethical perceptions of their holdings. Neither Daewoo nor PT BIA are members of the Roundtable on Sustainable Palm Oil, the Council noted.
Its 0.4 percent stake in Genting was worth around $41 million, and its 1.6 percent position in IJM was estimated at $46 million.
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Officials at the South Korean and Malaysian companies couldn’t immediately be reached or weren’t immediately able to comment after the close of regular business hours.
