|partly-owned companies and other business relationships. To contribute to improving supplier standards, adequate procedures for monitoring, evaluation and/or selection of suppliers reflecting Hydro’s social responsibility principles shall be developed.
While each Hydro employee has a responsibility to abide by the company’s CSR fundamental principles, specific responsibility for implementation is assigned to line management and business units. Each Business Unit is responsible for integrating relevant CSR issues into its strategy development. Challenges related to CSR are evaluated in connection with the yearly business planning process. Corporate CSR Staff is responsible for developing CSR policy and reporting guidelines, monitoring internal performance, and for providing general support to the Business Units. Corporate CSR is also responsible for coordinating external reporting at a corporate level and for developing and maintaining relationships with other companies, institutions and organizations in order to share knowledge and competence.
Central Bank of Norway—NORFUND
The Norwegian authorities encourage Norwegian investment in least developed countries to contribute to economic growth. The Norwegian Investment Fund for Developing Countries (Norfund)6 collaborates with the private sector to facilitate cooperation between public and private interests for investments in developing countries. This special “pension” fund was created to pursue the development agenda in developing countries, while creating savings for the future generation in Norway. It is about $600 billion and is derived exclusively from oil revenue. The Fiscal Rule stipulates that the Government can only spend 4 percent of real returns in any given fiscal year. The Fund functions a lot like an endowment; the principle is never touched. Four percent goes directly into the Government’s budget and makes up 10 percent of the total budget. The fund started in 1990, but ethical guidelines for investment were issued only in 2004. The Government strives for no more than 10 percent ownership and is therefore always a minority owner. The Fund is not used as a foreign policy tool and the Government does not involved in managing it. In the future, the Fund plans to rebalance its portfolio by investing less in Europe and more in developing countries.
Social responsibility considerations play a central part in the Government’s management of the Fund. It uses to approaches to ensure that the Fund respects CSR guidelines and the various international conventions espoused in them. As an investor and part owner (albeit a minority owner), the Government shares the responsibility for the ethical behavior of companies in which it invests. Thus, through this sovereign fund the Norwegian government can influence change in businesses in developing countries that may not have the mechanisms to adopt ethical standards. By participating with such companies, Norway hopes to have an impact on the ground and gradually bring on change. The other approach is through “exclusion” or the identification of companies that do not adhere to the Fund’s ethical guidelines. The investment guidelines, for example, stipulate that investments are only made in companies that adhere to human rights guidelines. The Ethical Council (8 members come from law, academia, etc.) is the Fund’s advisory body that evaluates and identifies companies to be excluded. Companies are excluded predominantly excluded based on the products that they produce and some on behavior in terms of labor and human rights and environment.
Ministry of Trade and Industry:
Thirty-seven percent of companies listed on the Oslo Stock Exchange are partially owned by the State. There are 80 state-owned enterprises in Norway, of which thirty are academic/learning institutions. Twenty-two of these companies are under the Ministry of Trade and Industry, with the exception of Statoil. The Ministry plays a coordinating role in terms of the CSR agenda, which is reviewed and updated every fourth year. All the State-owned enterprises are limited liability companies and in the Norwegian context there is no difference between a State versus a private company. The Government feels that it is important to divide considerations associated with ownership from policy making and supervision and control. The Board of a state-owned enterprise plays fully manages the company. The Boards are autonomous and Government does not have any representation. The Ministry holds quarterly meetings with each company.
In terms of CSR, the Ministry is concerned about diversity on the Boards of SOE. It’s one of the first countries to pass legislation that stipulates that 40 percent of a SOEs Board be comprised of women. It is working to companies to encourage them to ensure similar diversity at top management levels. Reporting on CSR is not mandatory, but voluntary. The Ministry however, gathers information on each SOE from various sources including the UN Global report.