The third term represents the desire for gradual interest rate changes in criterion 3, i.e. that the current interest rate it should not deviate too far from the rate in the previous period it-1. The fourth term represents criterion 4 and can be interpreted to mean that there is also a cost or risk in setting an interest rate it that deviates substantially from the interest rate implied by simple monetary policy rules itsimple. By giving some weight to the consideration that the key rate  BIS Review 113/2010  3  should not deviate too far from simple rules, monetary policy may become somewhat more robust. 1 Key policy rate  A monetary policy that only takes into account the consideration of bringing inflation rapidly back to target (criterion 1) would imply that the interest rate should rapidly have been reduced to below 1 per cent when we presented the latest Monetary Policy Report. In that case, the interest rate would have had to be raised rapidly again to prevent activity and inflation from becoming too high further ahead. Such a strategy could be consistent with the desire to safeguard against inflation expectations becoming entrenched below the inflation target, but could on the other hand have a substantial impact on output and employment. Developments become more stable if weight is also given to stabilising output (criteria 1 and 2). This would also imply an interest rate reduction first and then an interest rate increase further ahead.
The Executive Board lays down principles for responsible investment management and is responsible for decisions on the observation and exclusion of companies. Norges Bank has recently issued a consultation response to the report by the Mestad Commission assessing the guidelines for the observation and exclusion of companies. The Bank views the report as a good starting-point for further development of the GPFG as a responsible investor. Norges Bank addresses companies, not political conditions in countries. We remark in our consultation response that the GPFG enjoys the advantages of free and open markets, with no particular restrictions on our investments. The GPFG has today a clear financial objective. A change that blurs the distinction between company and state could raise doubts about the role of the GPFG. A new Central Bank Act entered into force on 1 January 2020. The Act has brought changes in the Bank's governance structure and organisation. A Monetary Policy and Financial Stability Committee was established at the beginning of the year. This has given the Executive Board greater capacity to work on the management of the GPFG. Over the past year, the Executive Board has completed a reorganisation of the administrative support functions at the Bank with the aim of pooling expertise, promoting cost-effective solutions and underpinning the identity of the Bank as a single institution. Another important change is the Executive Board's appointment of a new CEO for the Bank's management of the GPFG.