The Norwegian government said it has appointed a panel of experts to look into financial climate risk and climate-related investment opportunities in relation to the country’s NOK11trn (€1trn) sovereign wealth fund.
The group is to be led by Martin Skancke, who chairs the PRI board and also sits on the board of the Task Force on Climate-related Financial Disclosure (TCFD) as well as that of Norwegian financial group Storebrand, according to the announcement released yesterday.
Minister of Finance Jan Tore Sanner said: “We need more knowledge about how the transition to a low-emission society could affect the pension fund’s exposure to climate risk and climate-related investment opportunities.”
Other members of the expert group will be Karin Thorburn, a professor at NHH in Bergen; Kristin Halvorsen, director of climate research centre CICERO and Tone Bjørnstad Hanstad, investment professional at the investment firm Ferd.
Thomas Ekeli, former chief economist at Folketrygdfondet – which manages the domestically-invested part of the Norwegian SWF – is to be the secretary of the group.
The group is to submit its report by 15 August this year.
The ministry said it was concerned with how climate change, climate policy and the green transition could affect returns and risk at the Government Pension Fund Global (GPFG) and the management of the fund.
It said Norges Bank, which manages the fund via its Norges Bank Investment Management (NBIM) arm, already integrated assessments of financial risk as a result of climate change in its risk management, investment decisions and the exercise of its ownership.
“Furthermore, the ethically-motivated guidelines for observation and exclusion of companies from the fund contain several criteria for climate and the environment,” the Ministry of Finance said.
NBIM has plans to invest about 1% of the fund in unlisted renewable energy infrastructure by the end of next year, according to its 2020-22 strategy document, but has yet to buy its first such asset.
The government gave it approval to start investing in unlisted infrastructure back in April 2019, with this allocation to form part of its existing special environment-related mandates.
Chief executive officer Nicolai Tangen told Norwegian news service E24 last month that it was definitely NBIM’s ambition to make its first unlisted renewables infrastructure investment happen this year, having previously cited the intense competition for green energy projects as a reason for the slow start.