Oslo. Norway’s sovereign wealth fund, the world’s largest with more than $2 trillion in assets, announced that it will use artificial intelligence (AI) to protect its portfolio against climate-related financial risks. In its new climate action plan for 2030, the sovereign wealth fund explains that it will combine artificial intelligence with its own analytical tools in order to “streamline processes and improve decision-making.”
“The quality and availability of data have always held back sustainable finance, and AI can really help us overcome this obstacle,” said Wilhelm Mohn, global head of shareholder engagement.
The Norwegian government’s oil and gas revenue-funded reserve fund takes climate criteria into account when managing its investments.
It tends to favor dialogue with the companies it has invested in, but it can also withdraw its investment if the companies generate emissions considered “unacceptable” according to the Ministry of Finance’s ethical standards.
The fund believes that AI, together with the analytical tools it already uses, will improve data analysis. “We learn faster, work more efficiently, and improve our decision-making,” Mohn said during the presentation of the new plan. With this project, the fund seeks to reaffirm its commitment to the climate cause at a time when several companies and investors are turning their backs on it. The United States, under President Donald Trump, is also moving away from renewable energy in favor of fossil fuels.
“Climate change remains a financial risk, and this risk is only increasing,” said Carine Smith Ihenacho, Chief Governance and Compliance Officer.
The Norwegian fund was worth 20.75 trillion kroner (just over $2 trillion). It invests in around 8,500 companies worldwide and owns, on average, 1.5% of all publicly traded companies globally.
