Norway divests itself of mining giant Rio Tinto

Some interesting ethical investment news today from Norway – the country’s giant pension fund has sold its £500 million stake in UK mining company Rio Tinto, over concerns about its environmental practices.

Unlike the UK, which has frittered away its profits from the North Sea oil windfall, Norway has put all its oil money into a fund for the future. This huge pot of cash is now the world’s second largest pension fund, and a major investor. They also have rigorous ethical practices, and a number of companies have been black-listed from their portfolio in the past.

Rio Tinto is a partner in the world’s largest gold mine in Indonesia, Grasberg. The fund believes they are causing “severe environmental damage” to the area, and has withdrawn its investment. This follows research into the company’s ethical practices by both War on Want and CAFOD, while Friends of the Earth has been campaigning about Rio Tinto’s major project in Madagascar.

Despite the line-up of accusers, the company has reacted with dismay to this national rebuke: “Our immediate response is one of surprise and disappointment. We have an exemplary record in environmental matters, world leading in fact, and they are given the very highest priority in everything we do” according to their London spokesman Nick Cobban.

That the environment is Rio Tinto’s “highest priority” is somewhat laughable, but they are highly profitable. As one of our largest companies, they enjoy plenty of privileges from the UK government. All credit to Norway’s central bank for their ethical stand. Let’s hope others follow their example.