State pension fund sells shares in munitions companies

Jan 11, 2008, 10:16 GMT

Oslo - The Norwegian state pension fund has sold off its holdings in three munitions companies, including a South Korean firm that makes cluster weapons, over ethical concerns, the Finance Ministry said Friday.

A year ago, Norway hosted a conference aimed at banning cluster weapons worldwide.

In addition to dropping Hanwha Corporation of South Korea the Finance Ministry said it has divested its stakes in Serco Group of Britain and US-based GenCorp over their involvement in making nuclear weapons.

The ministry acted on guidance from a special ethics panel.

'According to the Council on Ethics, these companies produce cluster munitions and nuclear weapons, respectively, and we cannot participate in the funding of this type of production,' Finance Minister Kristin Halvorsen said.

The Finance Ministry said GenCorp had not replied to letters, while the South Korean group and Serco Group had done so.

Germany's Rheinmetall AG was however exempted after the ethics panel concluded it did not make cluster munitions at present.

Previously seven other cluster munitions makers and nine nuclear weapons producers have been dropped by the state pension fund.

The ethics panel has earlier recommended the state pension fund to divest from mining groups that conducted mining operations without sufficient safeguards for the environment.

The Government Pension Fund, Global, includes the huge Petroleum Fund.

The Petroleum Fund, managed by the Central Bank, was created to pay for Norway's future health and pension expenditures through investments outside the Norwegian economy.