The history

The idea of a Norwegian oil fund is conceived as prime minister Einar Gerhardsen and his government claims sovereignty over the Norwegian continental shelf. This laid the grounds for the Norwegian approach to pertroleum resource management, based on parliamentary guidelines for responsible and long-term management ensuring strong government control. 

The search for oil begins. 37 wells are drilled during the next four years.

Ekofisk, Norway’s first oil field, is discovered in the North Sea. Production starts in 1971.

The Ministry of Finance submits the parliamentary report “The role of petroleum activity in Norwegian society” discussing how the country’s oil wealth should be used.

The Tempo Committee, chaired by former Norges Bank governor Hermod Skånland, submits a report (NOU 1983:27) proposing the creation of a fund where the government can store the current temporary rush of oil revenue and spend only the real return.

Norway’s Parliament passes a law to establish the Government Petroleum Fund. The plan is to regularly transfer capital from the government’s petroleum revenue to the fund. The fund’s purpose is to support the government’s long-term management of petroleum revenue.

The fund gets its first capital transfer from the Ministry of Finance. This is invested in the same way as the Norwegian central bank’s foreign exchange reserves. This entails that all assets are to be invested outside Norway.

Norges Bank Investment Management is set up on 1 January to manage the fund on behalf of the Ministry of Finance.

Norges Bank Investment Management converts about 40 percent of the fund’s bond portfolio into equities within the first half of 1998.

Five emerging markets are added to the fund’s benchmark equity index.

Corporate and securitised bonds are added to the fund’s benchmark fixed-income index.

Ethical guidelines for the fund are established .

The Government Petroleum Fund changes its name to the Government Pension Fund Global.

The Ministry of Finance decides to increase the fund’s share of equity investments from 40 to 60 percent. It also decides to add small-cap companies to the benchmark portfolio. The increased equity share is implemented immediately.

The Ministry of Finance includes real estate in the fund's investment universe, with a maximum share of 5 percent of total assets. All emerging markets are included in the reference index for equities.

The international financial crisis leads to a negative return for the fund of -23.3 percent.

The fund’s ethical guidelines are evaluated, and new measures are initiated with entry into force from 2010. 

The share of equity investments reaches 60 percent in June.

The fund posts a record return of 25.6 percent.

A mandate is introduced to invest as much as 5 percent of the fund in real estate through a corresponding reduction in the fixed-income holdings.

The fund makes its first real estate investments.

The Ministry of Finance announces plans to gradually reduce the share of European holdings to about 40 percent of the fund and increase investments in emerging markets to 10 percent.

The annual return is the second best in the fund’s history so far, and the market value grows by more than 1,200 billion kroner.

The fund makes its first real estate investments in the US.

Starting this year, the Council on Ethics sends its recommendations directly to Norges Bank, instead of to the Ministry of Finance. Norges Bank’s Executive board now decides on the observation and exclusion of companies.

A new management model is introduced. From 2017 Norges Bank decides the real estate allocation within the mandate’s restriction that the unlisted real estate portfolio may constitute up to 7 percent of the investment portfolio.