NEWS

Norway’s $1.3 trillion wealth fund, the world’s largest, should reduce the size of its global company reference index by between 25% and 30% to better follow up companies, primarily by removing small-cap stocks, the finance ministry proposed on Friday.

The move reflects the growing awareness among international investors about risk in the environmental, social and corporate governance (ESG) field, in which the Norwegian wealth fund has often set the pace.

The fund’s reference index would be cut to around 6,600 companies from 8,800 now, the ministry said in its annual recommendation to parliament.

The fund also should not add, for now, more companies from emerging markets, including from Saudi Arabia, in the index governing its investment, it said.

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