The Norwegian Government Pension Fund Global (GPFG) achieved a 9.4% return on investment in the first half of this year, with companies like Alphabet, Microsoft and Facebook reported as the biggest stock winners during the period .

The Norwegian sovereign wealth fund (SWF) saw its value increase to NOK 11.67 billion (€ 1.12 billion) at the end of June after recording the investment gain of NOK 990 billion from January to June and seeing the government withdraw NOK 167 billion for the budget, fund manager Norges Report from Bank Investment Management (NBIM).

Also this morning, in conjunction with its unusually held press conference at the Arendalsuka national debate event in the Norwegian coastal town of Arendal, the NBIM unveiled a new biodiversity waiting document. and ecosystems, asserting that biodiversity would now become a priority.

Nicolai Tangen, CEO of NBIM, said: “Equity investments made the most positive contribution to performance in the first half of the year, and in particular investments in the energy and financial sectors.

According to the interim report, energy companies – which represented 3.2% of GPFG’s equity portfolio at the end of June – returned 19.5%, and with an allocation of 14.5%, financial companies generated a yield of 18.2%.

“Tech companies have returned 16.8%,†he said, adding, “Several large tech companies have seen a continued increase in digital advertising. “

The SWF held 19.8% of its stakes in the technology sector at the end of June.

Alphabet, Microsoft and Facebook were the top three contributors to GPFG’s absolute return in the first half of the year, producing NOK 38 billion, NOK 32 billion and NOK 19 billion respectively, according to published data.

However, the fund’s fixed income portfolio suffered a loss of 2.0% during the six month period. “The reopening of the global economy as well as the continuation of expansionary fiscal and monetary policy have made inflation a key theme in financial markets and led to a rise in global interest rates,” NBIM said in The report.

Government bonds, which represented 50.5% of the bond portfolio at the end of June, suffered the heaviest losses, ending the semester down 3.1%. UK gilts were particularly the losers for the SWF, losing 6.6% in local currency over the six months.

“Companies must […] understand their dependence and impact on nature, and manage both substantial challenges and opportunities through more sustainable use of ecosystems â€

Nicolai Tangen, CEO of NBIM

At the end of June, the GPFG held 72.4% of its assets in equities, 25.1% in bonds, 2.4% in unlisted real estate and 0.1% in unlisted renewable energy infrastructure, its new class of active.

So far, the fund has only made one investment in unlisted renewables, having invested € 1.37 billion in the Dutch offshore wind farm Borssele 1 & 2 in April.

The new asset class was reported to have suffered a 1.9% loss at the end of June, but NBIM said in the interim report that this was mainly due to exchange rate fluctuations when measuring the performance of the fund’s currency basket – the value of the investment has not changed from the price originally paid, NBIM said.

Regarding its new waiting document on biodiversity and ecosystems – intended to tell companies that it is investing in how they should take these topics into account – NBIM said: “Biodiversity will become a priority area for our work. ‘ownership in the future. “

He said the main message of the document was that companies that depended on or had a significant influence on ecosystems and biodiversity should integrate the mentioned considerations into their governance structure, strategy, risk management, metrics and reporting. .

Tangen said an increasing loss of species and deterioration of ecosystems could affect the ability of companies to create value for long-term investors.

“Businesses therefore need to understand their dependence and impact on nature, and manage both substantial challenges and opportunities through more sustainable use of ecosystems,†said the CEO of NBIM.

Yesterday, the NBIM published its response to the IFRS Foundation consultation on proposed constitutional amendments paving the way for an International Sustainability Standards Board (SSB) to establish IFRS sustainability standards.

The Oslo-based manager said he welcomes the proposal to create an SSB and develop global reporting standards for sustainability topics.

Among other things, NBIM said it supports the standards foundation’s ambition to focus on information important to investors and to include other sustainability topics beyond climate change.

Earlier this month, the IFRS Foundation consultation drew mixed reactions from investors, with some submitting answers without objection and others raising clear concerns, but for seemingly diametrically opposed reasons.

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