IPE Nordic Briefing: Independent review for active management of Norway’s SWF

Active management by Norway’s huge sovereign wealth fund – which may only deviate from its benchmark by 1.25 percentage points – is coming under new external scrutiny. The country’s Finance Ministry has now commissioned an independent review of active management at the Government Pension Fund Global (GPFG), appointing two academics from Norges Handelshøyskole (Norwegian School of Economics, NHH) in Bergen to do the analysis.

Only in May, the government announced the line up for a new expert council to advise it on managing the GPFG – with that new panel also set to tackle the question of Norges Bank Investment Management’s (NBIM) active management by the index-near fund, alongside other topics.

Elsewhere in Norway, municipal pensions giant KLP has announced the divestment of Germany’s Thyssenkrupp and US firm Oshkosh Corporation – for supplying weapons or equipment that are being used in Gaza by Israel’s military. Before selling them off, KLP had some NOK29m (€2.4m) in the shares of both companies, it said.

In Denmark, another pension fund has joined a public-private partnership (PPP) bid to realise a nationwide project to expand the Danish armed forces’ barracks, with Industriens Pension adding its name in late June to the investor group which started with AP Pension. Søren Tang Kristensen, head of real estate at Industriens Pension, the DKK255bn (€34bn) labour-market pension fund, said the scheme had good experience with the PPP model.

The group of investors angling for the government contract now also includes AkademikerPension and P+.

Pension funds in Iceland have warned the Icelandic government that a draft amendment to the main pensions act – which concerns the interaction between social security payments and disability pension payments – will drastically reduce pension rights, and could spark lawsuits under the property rights provision of the country’s constitution. 

“The bill under discussion here involves a transfer of rights intended for payment of old-age pensions to payment of disability pensions,” lobby group LL has said.

In Finland, pensions industry association TELA has been vocal in its rejection of the idea – which has been circulating as part of the ongoing debate over pensions reform – that the country’s earnings-related pension system should be reformed to allow for self-invested accounts, in the vein of Sweden’s premium pension.

TELA director Jari Sokka argued that the occupational pension system was “far too valuable to be sacrificed to the efforts to promote mass capitalism”.

Items to note:

• Swedish national pension fund AP7 has sold its entire stake in Tesla after it lost patience with the US electric carmaker’s conduct regarding labour relations. The premium pension default fund said the Tesla divestment corresponded to just over 1% of AP7’s main portfolio, at a value of SEK13bn (€1.16bn).
• The IPE Iceland one-day forum event for the country’s investment decision makers, asset managers, European pension funds, will take place on 8 October at Reykjavik’s Harpa Concert Hall and Conference Centre.

Rachel Fixsen

Nordic Correspondent