Responsible investment efforts in a long-running engagement between Norway’s sovereign wealth fund and Shell are being hampered by reliance on one-sided information, according to an activist leader who met the fund last week.
Marking 10 years of the official engagement by Norges Bank Investment Management (NBIM) with the oil giant over severe environmental damage linked to its operations in the Niger Delta region, activists from Nigeria and elsewhere met face-to-face with the fund last week.
Reverend David Ugolor, executive director for the Africa Network for Environment and Economic Justice (ANEEJ), told IPE that NBIM was facing some problems: “There is the problem of legitimacy of the sources of their information.”
Information in NBIM’s most recent responsible investment report saying Shell was engaging with the community and involved in the clean up was not true, he said.
In October 2013, the Council of Ethics of Norway’s Government Pension Fund Global (GPFG), which NBIM manages, recommended the then named Royal Dutch Shell be put under observation over its activities in the Niger Delta, alleged to have led to severe environmental damage because of extensive oil spills, the council said.
But instead of placing Shell – in which the GPFG owned 3.4% or $6.2bn at the end of 2022 – under investigation, as recommended, the Norwegian government asked NBIM to include oil spills in its active engagement effort and discuss the matter with the company.
Ugolor said that for more than two years, his organisation had been calling for investors to visit the Niger Delta to at least assess for themselves rather than relying on third-party information.
“The multinationals are very powerful, they use their power to undermine the opportunity for investors to have the right information.
“That’s what we discovered when we went to Norway, because we asked NBIM how do you get your information to write your responsible investment report? They agreed with us that they rely on third-party information.
“We asked do you did you give a chance for the community where these investments are located to hear their own side of the story? They said no.”
Ugolor – alongside collaborators from Nordic campaign groups Framtiden and ActionAid Denmark – met Carine Smith Ihenacho and Eivind Fliflet, NBIM’s chief governance and compliance officer and head of environmental initiatives, respectively, on 1 November, having met the Council on Ethics earlier in the week, lobbying for progress in the long engagement with Shell that NBIM has been involved in regarding environmental damage linked to the oil company in the Niger Delta region.
NBIM confirmed the meeting took place, but declined to say what had happened at the event.
Asked by IPE why the engagement had been going on for so long, a spokeswoman for NBIM said: “The length of the dialogue was prescribed by the Ministry of Finance, and we have reported on progress annually in our responsible investment reports.
“We are now in the process of evaluating progress towards our engagement objectives and next steps,” she said.
Asked to comment on the matter, an SPDC (Shell Petroleum Development Company of Nigeria) spokesperson said:
“Oil is being stolen on an industrial scale in the Niger Delta. Most oil spills there continue to be caused by crude oil theft, the sabotage of oil and gas production facilities, and illegal oil refining. These challenges are complex and widespread, affecting communities where a Shell subsidiary in Nigeria may never have operated.
“The SPDC joint venture manages these challenges using its expertise in spill prevention, response and clean-up. Irrespective of cause, SPDC cleans up and remediates areas affected by spills from its facilities or pipeline network, working closely with regulators, local communities, and other stakeholders.”
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