The Norwegian sovereign wealth fund's ethical council is considering whether to recommend the fund sell its 107 million kroner ($20 million) of bonds in Israel Electric Corp. because of an alleged participation in a blockade of the Gaza Strip.
Norwegian Foreign Minister Kristin Halvorsten wants an ethics council to investigate Israel Electric over its role in cutting back electricity supplies to Gazans.
Photo: Courtesy
"Information that the Israeli government is using this company to cut electricity supplies to Gaza, and thereby worsening the situation for civilians there, has made Finance Minister Kristin Halvorsen ask the ethics council to investigate the company," ministry spokeswoman Kaja Haldorsen said by e-mail Thursday. Israel Electric wasn't immediately available for comment.
The government has banned the 2.08 trillion-krone fund from investing in companies involved in nuclear weapons or cluster munitions, and companies that it says are guilty of human rights or environmental abuses. An ethics council investigates companies alleged to be breaking the investment guidelines.
Israel Electric is a state-owned monopoly power supplier.
Norway, the world's fifth-largest exporter of crude oil, places most of its petroleum revenue in the fund. The pension plan is the world's second-largest so-called sovereign wealth fund after the Abu Dhabi Investment Authority. It is forecast to double in size to more than 4 trillion kroner by 2014.
The Church of Norway asked the government in January 2006 to review its investments and possibly withdraw from companies that "are active in the construction of the wall and Israeli settlements in the occupied West Bank."
The ethics council concluded that there were no grounds for excluding companies active in Israel "or in areas under Israeli occupation," Finance Ministry senior advisor Aslak Skancke wrote at the time. "However, the possibility is not ruled out that information may be revealed in the future leading to closer examination and possible recommendations."
Companies that have been dropped previously by the fund include Poongsan Corp., Lockheed Martin Corp, Raytheon Co., European Aeronautic Defence and Space Co. and Wal-Mart Stores Inc., according to the Finance Ministry.
The Norwegian fund was established 11 years ago and is one of the world's oldest sovereign wealth funds. Yngve Slyngstad took over as head last month, succeeding Knut Kjaer, who managed the fund since its inception.
Tal Barak in Tel Aviv contributed to this report.
