Norwegian Sovereign Fund Removes Petrobras from Companies Under Scrutiny

RIO DE JANEIRO, BRAZIL – The Bank of Norway announced yesterday, December 3rd, that it has removed Petrobras from the list of companies under scrutiny. The company was included in the list in January 2016, after the corruption cases uncovered during the operation Lava Jato’s investigations.

The bank followed the recommendation of the Ethics Council of the Norwegian Sovereign Fund, which recognized the measures implemented by Petrobras in the fight against corruption. With the removal from the list, Petrobras is once again eligible to benefit from investments from the Norwegian fund.

In its recommendation to the bank, the Ethics Council emphasizes Petrobras’ willingness to cooperate with the investigations and with the solution of the cases.

“In the Council’s opinion, the measures that Petrobras has implemented in recent years prove considerable willingness and ability to prevent, uncover and deal with corruption,” the body said in a document.

The council further notes that the Brazilian Federal Prosecutor’s Office and the Supreme Court have officially designated Petrobras as a victim in the context of investigations into Operation Lava Jato.

According to Petrobras’ Director of Governance and Compliance, Marcelo Zenkner, this is an acknowledgement of the hard, technical and committed work that has been carried out by the company in recent years.

“Our internal control system, which is already much sturdier, is evolving to become a reference in the national and international scenario. The measures implemented are reshaping the internal environment and are already reflected externally, demonstrating that Lava Jato is a turning point in Petrobras’ history,” he said.

Since 2014, Petrobras has implemented several compliance measures, such as the establishment of an independent Reporting Network and conducting Integrity Due Diligence, a procedure that assesses the anti-fraud and anti-corruption tools of the companies with which Petrobras does business.

The company also started to apply the Integrity Background Check (BCI), which verifies the integrity of all administrators, managers and employees who work in critical operations.

Norway Fund

Created after the oil findings in the North Sea, The Government Pension Fund Global, also known as the Oil Fund, was established in 1990 to invest the surplus revenues of the Norwegian petroleum sector. It has over US$1 trillion in assets, including 1.4 percent of global stocks and shares, making it the world’s largest sovereign wealth fund.

In May 2018 it was worth about $195,000 per Norwegian citizen. It also holds portfolios of real estate and fixed-income investments. Many companies are excluded by the fund on ethical grounds.The fund currently invests in some 9,000 companies in 70 countries and, in addition to profitability, considers integrity, environmental and social issues in its investment decisions.