Norway’s sovereign wealth fund, managed by Norges Bank Investment Management (NBIM), has announced its decision to actively engage with global mining giants Rio Tinto and South32 concerning their environmental practices. The decision follows a recommendation from the Council on Ethics, an independent advisory body appointed by the Norwegian government, which urged the fund to consider divesting its stakes in the companies due to environmental concerns.
NBIM currently holds approximately 2.5% of Rio Tinto plc, 0.13% of Rio Tinto Ltd, and 2.6% of South32, according to data from LSEG. The ethical concerns center around the companies’ involvement in the Mineração Rio do Norte (MRN) joint venture, a substantial bauxite mining operation located in the Amazon rainforest. The project, a collaboration between Glencore (45%), Rio Tinto (22%), and South32 (33%), has been criticized for contributing to environmental degradation in the region.
In response, the sovereign wealth fund’s executive board stated that it would engage with the companies over the next five to ten years to encourage substantial improvements in their environmental management and practices.
In a separate announcement, the fund revealed it had revoked the exclusion of German energy firm RWE AG, applauding its progress toward renewable energy. Conversely, it decided to sell its shares in Mexican oil company Petroleos Mexicanos (Pemex) and Israeli firm Paz Retail and Energy, citing ethical concerns as the primary reason for the divestment.
