Stockholm (NordSIP) – With the signing of the Paris Agreement in 2015 and the launch of the UN Sustainable Development Goals (SDGs), sustainable investments rose in popularity. However, those goals are not always reached or even pursued. To this effect, NGOs serve a crucial purpose in society by holding a mirror to investors and keeping them accountable. Now, a new report suggests that NBIM is failing to act as the sort of climate leader it claims to be.
NBIM and Climate Leadership
Norway’s Government Pension Fund Global oversees the investments made by the profits from the country’s oil and gas sales is one of the world’s single largest investors. The fund is managed by Norges Bank Investment Management (NBIM), which “aims to be the world’s leading investor in climate management”.
However, according to the latest report from Norwegian NGO Framtiden i være hans (Future in our hands), which analyses how the sovereign fund uses its votes in issues related to climate, “NBIM does not live up to its own climate action plan”. The report notes that NBIM’s portfolio includes oil giants such as Shell, BP and Exxon Mobil and that 94% of the oil companies are planning expansions, inconsistent with the Paris Agreement’s goal of limiting global warming to 1.5 degrees.
NBIM’s Voting Record
The report reviewed the voting records of NBIM at 21 resolutions from 16 companies, which were flagged as critical by the advocacy organisations Climate Action 100+, Reclaim Finance, and ShareAction. According to the report, in 17 of these 21 resolutions, NBIM supported the company’s board and voted against better climate management.
“The report found that, despite NBIM’s Climate Action Plan, the fund fell short of expectations by continuing to support climate-harmful resolutions at companies in high-emitting sectors, such as fossil fuels. This contrasted with several investment funds in Denmark, the Netherlands, and Norway, which consistently voted for climate resolutions promoting better climate management. These findings revealed a significant gap between NBIM’s climate expectations and its actual voting behaviour,” said Lucy Brokes, an advisor on sustainable finance at the NGO.
In the majority of the cases it voted against climate targets (12 out of 17 times), NBIM did not provide any explanation when voting with the company board against better management or disclosure of climate risk, which is standard policy for the asset manager.
Not the First Warning
This is not the first time that the NGO has shed a critical light on NBIM. An earlier report looking at NBIM’s climate voting record during 2023. “The report found that, despite NBIM’s Climate Action Plan, the fund fell short of expectations by continuing to support climate-harmful resolutions at companies in high-emitting sectors, such as fossil fuels,” Framtiden i være hans says.
NBIM’s attitude is also contrasted with that of several investment funds in Denmark, the Netherlands, and Norway, which consistently voted for climate resolutions promoting better climate management.