The world’s largest sovereign wealth fund has pulled out of UK-listed G4S, claiming the security company poses a risk to its ethical position on human rights.
Norway’s £ 860 bn fund – which operates under guidelines set by its parliament – is tasked with investing the proceeds of the country vast oil and gas output.
It owns shares in more than 9, 000 firms worldwide and has previously exited more than 150 investments on environmental, health and other grounds.
The fund’s board announced the firm, in which it had owned a 2.3% stake, posed an “unacceptable risk” to its stance on the human rights of migrants workers.
The decision – revealed to G4S in April – was based, it said, on an assessment of the company’s operations in Qatar and the United Arab Emirates by the fund’s Council on Ethics.
Its concerns stemmed from the fact, the council said, that many of the 18, 000 G4S staff in the Gulf nations are from overseas who paid recruitment fees to join the company.
The council’s statement explained: “When the workers arrive in the Gulf, they must spend a significant part of their salary to pay off this debt, and therefore have little chance of leaving.
“Many also received far lower wages than agreed, and in the Emirates, the workers got their passport confiscated,” the Council of Ethics statement said.
“The council’s investigations also revealed long working days, a lack of overtime payment and examples of harassment. “
The fund drew down its stake in the business gradually before revealing its decision.
It tallies with worries, expressed over many years by global agencies, about general employment conditions for migrant workers in the Gulf.
G4S had suffered a 2.4% fall in its share price by the close of trading on Thursday.
A spokesperson said: “We welcomed the engagement with the Council on Ethics over the past three years and we wholeheartedly agree that migrant workers need care and support and deserve to be treated with dignity and respect at all times .
“We are committed to ensuring that they feel confident that they can raise any concerns they have about any aspect of their emp
“We carried out a robust investigation into the issues raised by the Council on Ethics into G4S’s employment practices in Qatar and the UAE.
” We are making good progress on our action plan to reinforce our high standards in relation to employee recruitment and welfare provisions in the Middle East.
“We have appointed a full-time migrant worker co-ordinator whose primary role is to conduct research into recruitment agencies, their practices and fees in each of the countries of origin, ensuring strict compliance with our code and that our policies and standards of employment are upheld. “