- Panama documents have added urgency to the push, Labor says
- Ethical framework already allows divestments, goverment says
Norwegian lawmakers are pushing for the country’s $850 billion sovereign wealth fund to drop all investments in companies that use tax havens as indignation over the practice swells.
“Norway will have a serious problem in explaining how we can continue using the world’s biggest fund to legitimize robber states that are hiding corrupt money,” said Snorre Valen, a lawmaker for the Socialist Left, who urged other parties in parliament to back the initiative. The fund has an estimated 200 billion kroner ($24 billion) in assets parked in tax havens, according to Valen.
Revelations by the International Consortium of Investigative Journalists that politicians, banks, celebrities and criminals across the globe used Panama-based law firm Mossack Fonseca to hide wealth have caused widespread embarrassment and forced a spotlight on the culture that allowed such practices. ICIJ cited a leak covering documents spanning 1977 to 2015.
Part of the Norwegian wealth fund’s real estate unit, which was granted permission on Tuesday to add $17 billion to its portfolio, is based in Luxembourg. While the use of low-tax bases can be perfectly legal, the Panama documents have ignited a global debate on the seemliness of continuing such practices.
Lawmakers from Norway’s Labor Party, the country’s largest opposition group, and the Christian Democrats, which backs the government, signaled they would consider looking over the wealth fund’s investments in tax havens. A similar push in 2015 was rejected by the government and Finance Minister Siv Jensen on Tuesday again defended the existing framework.
“Questions arise from time to time on individual investments that create a lot of discussion,” Jensen said. But the fund’s ethical framework already allows it to exclude companies that have “illegal or unethical corporate activity,” she said.
The fund manages its investments according to the mandate of its owner, which is the Norwegian state, said Marthe Skaar, a spokeswoman for investor. “We have full disclosure of country of origin for all our investments.”
Labor, Norway’s largest political party, says looking into such exposures will be a priority this year.
“The Panama papers make it more urgent to look into this,” said Torstein Tvedt Solberg, a Labor Party lawmaker.