State of the Rainforest 2014

The path to a forest destruction-free investment portfolio

forest resources. Therefore, a very effective approach to reducing forest destruction can involve getting financial institutions to adopt no-deforestation policies, and to place demands on the companies they invest in or lend capital to. Norway’s Government Pension Fund Global (GPFG) is a good example. The GPFG is the world’s largest sovereign wealth fund, with a value of more than USD 800 billion. It invests at least USD 21 billion in industries that constitute the greatest threats to the world’s rainforests. 44 The GPFG has investments in at least 88 companies that conduct operations in tropical forest areas and that belong to the industries of oil and gas, palm oil, soy, mining, cattle

Norway’s Government Pension Fund Global is the biggest sovereign wealth fund in the world. With its heavy investments in the industries that destroy rainforests, the Fund has the opportunity as well as the responsibility to reduce forest destruction by exerting influence on the companies in its investment portfolio. The main drivers of tropical forest destruction are commercial companies that exploit natural resources found in forest areas – like timber, minerals or oil – or clear forests to use the land for agriculture – like palm oil, soy and cattle ranching. 43 The banking and finance sector indirectly contributes to forest destruction by providing the capital that makes it possible for companies to exploit

Risky business Norwegian pension fund investments in business sectors causing deforestation 2013

Japan

Canada

South Korea

United States

Russia

Norway

Papua New Guinea

Hong Kong

China

United Kingdom

Malaysia

Thailand

Italy Belgium

Colombia

France

Australia

Spain

Singapore

India

Indonesia

Other South American countries

Central Africa

Investments in high-risk sectors, equities Million US Dollars 6 600

Brazil

Investment in companies operating in rainforest countries and based in other countries Investment directed to companies based in rainforest countries Share of investment that goes through companies based in non-rainforest countries

2 500 1 000 500 9

South Africa

78

STATE OF THE RAINFOREST 2014