Norway’s Norges Bank Investment Management (NBIM) has welcomed the OECD’s proposal to revise its Guidelines for Multinational Enterprises to reference the International Sustainability Standards Board (ISSB).

In its response to the OECD’s consultation, NBIM, which is responsible for the investments of the Government Pension Fund Global, said there was a need for corporate reporting to be consistent and comparable across markets, and it therefore welcomed the ISSB’s aim to develop a comprehensive global baseline of financially material sustainability disclosures.

It suggested that the OECD’s Guidelines for Multinational Enterprises uses the same definition as the one used by the IFRS.

The OECD has also proposed providing further clarity on companies’ responsibilities across complex corporate structures and value chains.

NBIM welcomed the expansion of the scope of application from a supply chain perspective to a value chain perspective, and agreed that due diligence should be risk-based, adjusted to the severity and likelihood of adverse impacts.

It noted that the extension of the guidelines needed to take account of the nature of value chain linkages and the degree of leverage that companies have over their business partners so they remain feasible for companies to implement.

NBIM also welcomed the suggested revisions to the environment chapter of the guidelines, notably on climate transition plans, and the new requirements on biodiversity.

“We believe companies that either depend on or significantly impact ecosystems and biodiversity should integrate these considerations into their governance structure, strategy, risk management and reporting,” it stated.

On human rights, NBIM said it was please to see the requirement for companies to make their policy commitment to respect human rights public.

“Finally, we support efforts by the OECD to strengthen the functional equivalence of National Contact Points (NCP) and preserve the legitimacy of the NCP mechanism,” NBIM continued.

“Regarding specific instances concerning multiple adhering countries, we suggest clarifying the language on the identification of the lead and supporting NCPs.

“The lead NCPs should, as a main rule, be the NCP of the country where the issue has arisen/taken place.

“It is also important that NCPs in practice take a coherent approach to assessments of business relationships and obligations, especially in the initial assessment of specific instances.

“The implementation procedure system is not set up with the purpose of targeting multinational enterprises regarded as ‘best in class’ with specific instances, which should be reserved for issues that constitute risks of breaches of the guidelines.”

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