Norges Bank has announced plans to exclude two companies from Norway's Government Pension Fund Global (GPFG), following recommendations from the GPFG's Ethics Council.

In its latest update, Norges Bank confirmed that its executive board decided to exclude Bezeq The Israeli Telecommunication Corp Ltd due to an "unacceptable risk" of the company contributing to serious violations of individuals' rights in war or conflict situations.

In addtion to this, the executive board decided to exclude the company Evraz PLC due to the "unacceptable risk" that the company contributes to "particularly serious breaches of basic ethical norms".

Evraz PLC is one of a number of companies that were expected to be sold off after Norway’s Ministry of Finance decided that the government's pension fund should leave Russia after the invasion of Ukraine in February 2022, although Norges Bank explained that, due to sanctions and operational challenges, the fund has not yet managed to sell itself out.

The executive board has also decided to cancel the observation of the company Hyundai Engineering & Construction Co Ltd.

The company was put observation in July 2021, after concerns were raised around the "unacceptable risk" that the company has contributed to or itself has been responsible for gross corruption.

However, the company has since introduced an anti-corruption system, which the GPFG Ethics Council said was in line with internationally recognized recommendations for such systems.

It therefore decided that the risk of gross corruption in the company's operations is therefore no longer considered unacceptable.

Whilst the bank is required to assess whether other instruments, including the exercise of ownership, may be more suitable before exclusion, the executive board confirmed that ownership exercise is not an appropriate means of action in these cases.

All three of these decisions were based on recommendations from the GPFG's Ethics Council and, whilst the executive board has not independently assessed all details in the recommendations, it said that it found it sufficiently proven that the criteria for exclusion and observation have been met.

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