Norway blacklists Israeli firm for ethical reasons

Norway's state pension fund, one of the world's biggest investors, banned on Thursday an Israeli company from its portfolio for ethical reasons and rehabilitated France's Thales and South Africa's DRD Gold, the government said.

Israeli group Elbit is accused of providing a surveillance system for the separation wall in the West Bank, which the International Court of Justice ruled illegal in 2004.

"We do not wish to fund companies that so directly contribute to violations of international humanitarian law," Finance Minister Kristin Halvorsen said in a statement.

On the advice of the fund's ethical council, the Norwegian government asked the central bank that manages the pension fund to divest its shares in the company, the value of which was not disclosed, by Aug. 31.

The Government Pension Fund, more commonly referred to as the "oil fund," was valued at 2.38 trillion kroner (277 billion euros, $395 billion) in stocks and bonds at the end of June.

It contains nearly all state revenues from the oil industry in Norway, one of the world's largest oil and gas exporters.

It was set up to help finance the country's generous welfare state system once the wells run dry.

Ethical guidelines from the government bar the fund from investing in "particularly inhumane" weapons manufacturers and in companies known to be involved in large-scale human rights violations, corruption, or environmental pollution, as well as tobacco companies.

The government also announced on Thursday that it would allow the fund to once again invest in French electronics defense group Thales, barred in 2005 for its involvement in the production of cluster bombs, and in the South African mining group DRD Gold, banned in 2007 due to environmental pollution it caused in Papua New Guinea.

"The Council on Ethics has found that the grounds for exclusion are no longer valid, because Thales no longer has any form of involvement in the manufacture of cluster munitions in any country," the finance ministry said.

DRD Gold has meanwhile pulled out of the polluting mine.

Some 30 multinationals are on the fund's blacklist, including Boeing, Wal-Mart, EADS, Safran and BAE Systems.

We do not wish to fund companies that so directly contribute to violations of international humanitarian law

Norway Finance Minister Kristin Halvorsen