29 May 2015
Norway’s parliament reached an agreement overnight that will see it’s sovereign wealth fund divest from companies that derive more than 30% of revenue or business from coal.
Worth around $1.15 trillion, the fund is the largest of its type in the world, and this decision signals the greatest win for the divestment movement to date.
In local terms, the Norway Government Pension Fund Global (GPFG) will divest more than $138 million from Australian companies, and the hardest hit by far will be AGL, who stand to see more than A$132 million worth of their shares dumped.
Other big players in the Australian coal industry that will be affected by the decision are New Hope (A$3m worth of shares), Cokal ($1.5m) and Yancoal ($1.9m), and while the Norwegian fund has only limited exposure to Cockatoo Coal, the decision means that the company has lost a powerful possible investor.
Linc Energy may also be subject to the Norwegian divestment movement, with the fund currently holding over $600,000 worth of shares.
While this impressive win for the divestment movement is certainly worth celebrating, it must be noted that the fund will continue to support major coal players like BHP Billiton and Origin Energy as they fall below the 30% coal threshold.
The Norway GPFG currently hold shares worth almost $1.5 billion in BHP and more than $142 million in Origin, so the battle is far from over!