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Norway’s sovereign wealth fund to invest in unlisted companies

In a press release published 15 Jan, the Norwegian Ministry of Finance announced that the Norwegian Government Pension Fund Global (GPFG) will consider investing in companies that are not listed on the stock market.

The fund, which is the world’s largest sovereign wealth fund, is worth over USD 1 trillion.  The Pension Fund is financed through Norway’s earnings from the sale of oil and gas and is meant to secure the Norwegian welfare state for future generations. Most of the fund is invested in listed stock companies as of now.

The Ministry of Finance presented reports from two expert groups that has been appointed by the government. The first expert group has examined Norges Bank’s (The Central Bank of Norway) management of the GPFG, while the second expert group has assessed investments in unlisted equity. Their assessments will be discussed in the yearly report to the Norwegian Parliament this spring.

According to media reports, there has been a decline of listed companies the past decades, referring to the nearly fifty percent decline in listed American companies in the United States since 1996.

Investments in unlisted stock companies has proved to offer a slightly higher return than listed companies. These findings may potentially lead the GPFG to move great amounts of capital into green energy and technology companies, which can be seen as a beneficial long-term move.