In 2016, Norway’s sovereign wealth fund announced34 the fund would sell its $ 15 million holdings in Chinese telecom giant ZTE and make no future investment in the company because of the risk the company would become involved in corruption scandals. The fund’s investment guidelines stipulate that it may exclude any company where there is an unacceptable risk that the company contributes to or is responsible for activities that result in the violation of human rights, lead to severe environmental damage, or further gross corruption. The reputational damage is significant as ZTE lost access to the world’s largest sovereign wealth fund and one of the largest pools of capital investment.
Source: Norges Bank Investment Management, “Decision on exclusion of company from the Government Pension Fund Global“, https://www.nbim.no/en/the-fund/news-list/2016/decision-on-exclusion-of-company-from-the-government-pension-fund-global/
