DECISIONS ABOUT EXCLUSION
The Executive Board in Norges Bank has decided to exclude the companies PacifiCorp and Tri-State Generation and Transmission Association Inc based on an assessment of the product-based coal criterion in the Guidelines for observation and exclusion §2 (2).
The Executive Board has also decided to exclude the companies JBS SA due to an unacceptable risk that the company is responsible for gross corruption, and the company Luthai Textile Co Ltd due to an unacceptable risk of serious or systematic human rights violations (see §3, subsection e and a of the Guidelines). The Executive Board’s decisions on exclusion were made on the basis of recommendations from the Council on Ethics.
DECISION ABOUT ACTIVE OWNERSHIP
Furthermore, the Executive Board has decided to follow the company UPL Ltd’s work to counteract child labour as part of the fund’s active ownership efforts over a period of five years. The Council on Ethics writes in its recommendation that the company has stated that it will continue and reinforce measures to reduce the extent of child labour in relation to the company's activities.
The Council on Ethics has recommended that the company should be placed under observation to await the results of the reinforced efforts. According to the guidelines, Norges Bank shall consider whether other measures, including the exercise of ownership rights, may be more suited to reduce the risk of continued norm violations, or whether such alternative measures may be more appropriate for other reasons. The Executive Board concludes that active ownership in this case is more suitable to reduce the risk of future violations by providing further support to the company's enhanced efforts to counteract child labour in it's operations.
DECISIONS ABOUT OBSERVATION
The Executive Board has also decided to place the companies Berkshire Hathaway Energy Co and MidAmerican Energy Co under observation based on an assessment of the product-based coal criterion in the Guidelines for observation and exclusion §2 (2). In addition, Nien Hsing Textile Co Ltd has, in accordance with the recommendation from the Council on Ethics, been placed under observation due to an unacceptable risk of serious systematic human rights violations (see §3, subsection a of the Guidelines).
According to the guidelines, observation may be decided when there is doubt as to whether the conditions for exclusion are met or as to future developments, or where observation is deemed appropriate for other reasons.
The Executive Board has not conducted an independent assessment of all aspects of the recommendations, but is satisfied that the criteria for exclusion, active ownership and observation have been fulfilled.
Grounds for decision and Council on Ethics recommendations
Communications Advisor, Norges Bank Investment Management
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