Norwegian pension company KLP has excluded engineering equipment manufacturer Caterpillar from its funds’ investment portfolios.

It stated that it decided to exclude the company due to “the risk of contributing to violations of human rights and international law”.

KLP said that Caterpillar had “supplied bulldozers and other equipment that have been used to demolish Palestinian houses and infrastructure” and said there were "allegations" that equipment the firm had supplied had been “used in warfare in Gaza” after 7 October 2023.

The pension company added that, over several months, KLP had been in dialogue with Caterpillar about the risk it contributes to violations of human rights and international law.

At its general meetings in 2022 and 2023, KLP voted for the company to report on risks linked to businesses in conflict areas and felt that, in its responses, the firm had not addressed these risks.

KLP and the KLP funds owned shares and bonds worth NOK 728m in the company until 17 June 2024.

“As the company, in light of the current situation, cannot assure us that they are taking action, we choose to exclude the company,” commented KLP Kapitalforvaltning head of responsible investments, Kiran Aziz.

“Although Caterpillar has shown itself willing to engage in dialogue with KLP, the answers gave little credibility that they have taken good measures to reduce the risk of complicity in violations of human rights in war and conflict situations, as well as international law.”

Caterpillar has been contacted by European Pensions for comment.

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