Norwegian government pension fund withdraws investment from AWE partner

The Norwegian government's pension fund has withdrawn its investments from Jacobs Engineering – one of the parent companies behind the consortium which manages the Atomic Weapons Establishment – because of its involvement in the manufacture of nuclear weapons.

The Norwegian Ministry of Finance announced last month that it had excluded Jacobs Engineering Plc and another US multinational, Babcock & Wilcox Co, from the investment portfolio of the Government Pension Fund Global (GPFG) because of their involvement in nuclear weapons production.

The value of the Norwegian fund’s shares in the two companies at the end of 2011 was US$33.71 million.

Jacobs Engineering has been a partner in AWE Management Ltd joint venture since December 2008, when it purchased a one-third share in the company previously owned by British Nuclear Fuels Ltd (BNFL).  The pension fund's Council of Ethics concluded that Jacob's involvement in the development, production, testing and maintenance of nuclear warheads was not compatible with the  fund's investment policy, and recommended that the Ministry of Finance should exclude the company from the GPFG investment portfolio.  Babcock & Wilcox, which operates facilities which produce fissile materials for the US nuclear weapons programme and maintain and upgrade nuclear warheads, was excluded for similar reasons.

At the same time as announcing its divestment from Jacobs and Babcock & Wilcox, the Ministry of Finance has lifted its exclusion on investments in BAE Systems Plc.  BAE Systems informed the pension fund that its involvement in the production of France's ASMP-A nuclear missile through its joint venture company MBDA had ceased.  BAE Systems remains involved in the design of the UK's 'Successor' Trident replacement submarine.

The decision to divest in Jacobs and Babcock & Wilcox followed pressure from the International Campaign for the Abolition of Nuclear Weapons (ICANW) following publication of their 'Don't Bank on the Bomb' report on the financial institutions behind companies that manufacture and maintain nuclear weapons.

The Norwegian Government Pension Fund has significant financial assets resulting from the country's income from oil revenues.  The fund has set itself the ambition that management of its assets will represent best practice for responsible investment, and has adopted a policy that assets in the Fund shall not be invested in companies which produce “weapons that violate fundamental humanitarian principles through their normal use”.

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