As a long-term and global investor with ownership stakes in several thousand companies, it is in the GPFG’s financial interest that portfolio companies succeed in adapting to the risks and opportunities that climate change entails. Norges Bank supports the strengthening of the work on climate risk in the GPFG. Responsible investments and active ownership will be key in this regard. Active ownership is directly aimed at the primary source of the GPFG’s climate risk, namely its portfolio companies. Norges Bank’s responsible investment shall be based on the long-term goal that investee companies align their activities in a way that is consistent with global net zero emissions in accordance with the Paris Agreement. 1/2  BIS central bankers' speeches  The GPFG’s size gives it strong access to company boards. The GPFG is among the ten largest owners of around half of its portfolio companies, and it is our experience that when we talk, the companies listen. Through active ownership, Norges Bank will be a driving force for the companies in the portfolio to align their business models towards a long-term goal of global net zero emissions. To this end, the Bank will strengthen our work on analysing decarbonisation pathways for individual companies and use these analyses in our follow-up of companies. It will not be the case that we will automatically divest if active ownership does not have the desired outcome. But in some cases, divestment may be relevant. In the period 2012–2021, Norges Bank made 366 risk-based divestments.
Ida Wolden Bache: Norges Bank’s management of the Government Pension Fund Global Introductory statement by Ms Ida Wolden Bache, Governor of Norges Bank (Central Bank of Norway), at the hearing of the Standing Committee on Finance and Economic Affairs of the Storting (Norwegian parliament), 3 May 2022. * * * I would like to thank the Committee for its invitation. Norges Bank manages the GPFG with the objective of achieving the highest possible return over time within the limits of the investment mandate defined by the Ministry of Finance. The objective of the highest possible return is to be achieved within an adequate control and risk management framework, in a responsible and cost-efficient manner with a high degree of transparency. The investment mandate is extensive. Around 70 percent of the over NOK 11 000 billion in the GPFG is invested in equities, which means we are one of the world’s largest shareholders. We a minority shareholder in around 9000 companies in 70 countries. In addition, we have a broad portfolio of fixed income investments. Some of the GPFG is invested in unlisted real estate, and in 2021, we also invested for the first time in unlisted renewable energy infrastructure. The GPFG is managed to track the benchmark index fairly closely, so that the return largely tracks the return on the benchmark index. The benchmark index is defined by the Ministry of Finance and endorsed by the Storting.