The Norwegian Finance Ministry sets the investment mandate for the fund, which held 2.4 billion Norwegian crowns ($428.7 million) worth of palm oil-related stocks in its portfolio as of end-2010.
The investment in Malaysian, Indonesian and Singaporean stocks was up about 57 percent from 2009, Reuters calculations on fund data show.
The oil fund owns stakes in around 8,500 companies, so its investment moves are closely watched. The fund invests the Norwegian state’s tax revenues from oil and gas activities to save for future generations and is world’s second largest after that of the United Arab Emirates.
Last week, policy group Greenomics Indonesia criticised the Norwegian fund for investing in palm oil firm Golden Agri Resources .
The Singapore-listed planter is the parent of Indonesia’s biggest palm oil firm SMART TBK that Greenpeace says had cleared high conservation value forests and carbon-rich peatlands. [ID:nL3E7EL1DS]
The Norwegian government has long set up an ethics council to suggest which companies it should exit for ethical reasons. There are ten companies blacklisted for environmental reasons including Malaysian loggers Samling and Lingui . [ID:nLDE71F211]
“The manager of the (fund)…has published documents which present the fund’s expectations of how companies should manage, amongst others, climate risk,” Malkenes said. “The exercise of ownership is another way the fund can seek to achieve behavioural change in the portfolio.”
The official added that the fund had invested over $4 billion in areas of water management and clean energy, without giving details.