Norway’s sovereign wealth fund blacklisted three companies on war-related grounds, after its Council on Ethics recommended excluding US defence equipment firm L3Harris Technologies, India’s Adani Ports and Special Economic Zone (APSEZ) and China’s Weichai Power Co.

In all, the exclusions are likely to mean the NOK17.8trn (€1.53trn) Government Pension Fund Global (GPFG) sold off nearly $400m (€368m) of securities, based on the exposure the SWF has documented on the website of its manager, Norges Bank Investment Management (NBIM), as having at the end of 2023.

The lion’s share of that exposure was the fund’s holdings in L3Harris Technologies, with the GPFG having held $315.4m of the US company’s equities and $9.8m of its bonds at the end of last year.

NBIM had $63.8m in the APSEZ equities, and $18.4m in the shares of Weichei Power Co at the same point.

The decisions to exclude each of the three companies had been based on recommendations from the Council on Ethics, NBIM said.

The council said it had recommended L3Harris Technologies be excluded from 
investment by the GPFG due to the company’s production of key components for
nuclear weapons.

APSEZ was recommended by the panel for exclusion due to an “unacceptable risk that the company is contributing to serious violations of the rights of individuals in situations of war or conflict”.

Weichai Power Co, meanwhile, was recommended for exclusion due to an unacceptable risk that it was contributing to the sale of weapons or military material to states that were subject to investment restrictions on govern­ment bonds – specifically, Russia and Belarus, according to the council.

In the case of L3Harris Technologies, the Council on Ethics said it had already excluded the company Aerojet Rocketdyne Holdings (ARH) from the GPFG back in 2007, when the firm had been called GenCorp, because it made motors for the nuclear weapon delivery systems Minuteman and Trident.

Following an acquisition, ARH is now a wholly-owned subsidiary of L3Harris, the council said.

Adani group subsidiary APSEZ has been on the GPFG’s watch list since 2022, due to its business association with Myanmar’s armed forces, it added.

Although APSEZ said last May it had sold its port-related operations in Myanmar to another company, the council said there was no information available on the buyer, so it could not establish whether APSEZ had links to the business.

“In a situation in which extremely serious norm violations are taking place, this constitutes an unacceptable risk that the GPFG’s investments in APSEZ may breach its ethical guidelines,” the council added.

IPE has contacted L3Harris Technologies and Weichai Power for comment on the NBIM decisions, but attempts to contact APSEZ were unsuccessful.

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