- September 29, 2008 - A new report by WWF and financial analysts Innovest shows that Norway's large and influential Government Pension Fund, with a reputation as a leader in ethical investments, does not apply best practice in sustainable investments, and is not yet fully addressing the impacts of global warming.

The $381bn fund is based on petroleum revenues and is the world's second largest sovereign wealth fund. Norway's Government Pension Fund alone owns more than 1% of all European stocks.

"Loaded with petroleum cash, Norway has a special responsibility to invest in low carbon development and help mitigate impacts from global warming on hundreds of millions of the world's poor," said Rasmus Hansson, CEO of WWF-Norway.

"The Norwegian Government is currently revising the ethical guidelines for the fund and now has a unique opportunity to introduce more progressive instruments for sustainable investment, such as positive screening and a climate technology investment fund."

The report ranks key public investment funds in terms of application of leading edge tools for sustainable investment, particularly with regards to addressing climate change. The ranking shows public pension funds such as ABP Netherlands and CalPERS to be leading the way, with sovereign wealth funds such as Norway’s Government Pension Fund lagging significantly behind, primarily due to not applying the latest best practices for positive screening and targeted environmental investments.

"Socially responsible investment can no longer be seen as a purely ethical exercise that reduces profit while doing good," said lead-author of the report Karina Wong, senior consultant at Innovest. "Rather, in an increasingly resource restricted world sustainable business models are a crucial indicator for long-term profitability and risk reduction."

"Institutional asset managers today control more than 80% of investments in the world and must play a proactive role in supporting companies that can become winners in a low-carbon economy, not just disinvesting from those that are unsustainable," said Dennis Pamlin, global policy advisor in WWF.

"We see promising signs, for example China's sovereign wealth fund CIC recently announced that it will invest in environment-friendly technologies. WWF will now explore the possibilities for the world's largest sovereign wealth fund's, Norway, UAE, Saudi Arabia, Singapore, Kuwait and China, to take a lead in implementing and developing further the investment practices and tools needed for a low carbon development the 21st Century."

The full WWF report "Fund Management in the 21st Century: The role of sovereign wealth funds in contributing to a low carbon future" can be downloaded at www.wwf.no

Innovest Strategic Value Advisors, Inc.

Innovest Strategic Value Advisors, Inc.

Innovest Strategic Value Advisors is an internationally recognized investment research and advisory firm specializing in analyzing companies’ performance on environmental, social, and strategic governance issues, with a particular focus on their impact on competitiveness, profitability, and share price performance. Innovest currently has offices in New York City, Toronto, San Francisco, London, Paris, Sydney, and Tokyo.

More from Innovest Strategic Value Advisors, Inc.