Norway’s sovereign wealth fund’s ethics watchdog will reportedly launch an investigation next year into companies in the fund’s portfolio, including those in the crypto sector, for potential ethical breaches. If concerns are confirmed, the fund may choose to divest from these entities.
Reuters reported Monday that the Council on Ethics for the fund will review its portfolio companies. If a company falls short in ethical compliance, the council may recommend divestment or add it to a public watch list.
Norway’s Government Pension Fund Global, the world’s largest sovereign wealth fund, manages assets worth $1.8 trillion. It was established to manage surplus income from the oil and gas industry, aiming to ensure financial stability for future generations through diverse global investments.
Norway’s Ethics Council to Investigate Crypto, Gambling Firms Over Money Laundering Risks
Reuters reported reviewing a document from the ethics council sent to the finance ministry on Oct. 10. The document states that in 2025, the Council on Ethics will investigate crypto and gambling companies, among others, due to their high money laundering risks.
The fund had reportedly increased its cryptocurrency investments, purchasing a 0.83% stake in Coinbase worth $453m. It also acquired shares in Marathon Strategy, Block and Marathon Digital.
The ethics watchdog will also probe other companies, including shoemakers. It will also review firms accused of human rights violations in the occupied West Bank.
Ethical Standards Lead Norway’s Fund to Exclude Hundreds of Firms
According to Reuters, Norway’s fund has excluded 189 companies on ethical grounds. These include Airbus and Boeing for nuclear weapons production, and Glencore and RWE for coal-related activities.
The fund’s investment choices are also guided by other ethical criteria, including human rights abuses, major environmental damage, severe corruption and the production of tobacco and cannabis.
Its primary aim is to spread risk across various asset classes to ensure stable long-term returns. Cryptocurrencies, while risky, offer a diversification benefit due to their low correlation with traditional financial assets.
Still, cryptocurrencies like Bitcoin remain under scrutiny for their energy-intensive mining, which may clash with the fund’s ethical investment standards.
Last month, a Norwegian government committee recommended delaying the launch of a central bank digital currency (CBDC). It stated that there is no immediate need to improve financial inclusion or emergency readiness, but emphasized the importance of preparing regulations for potential future issuance.
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