Norway Sovereign Wealth Fund Divests Mexico's Pemex Over Corruption Risk

Norway's $1.8 trillion sovereign wealth fund, the world's largest, has divested all its fixed-income investments in Mexico's state-owned oil company Pemex due to concerns over corruption spanning nearly two decades. The fund's ethics watchdog, the Council on Ethics, cited investigations revealing multiple allegations and suspicions of bribery involving Pemex employees, including former senior executives, and highlighted a lack of transparency about the company's anti-corruption measures. Notable cases referenced include the Odebrecht scandal and the imprisonment of former Pemex CEO Emilio Lozoya for fraudulent activities. Despite Pemex's claims of timely responses to information requests and having an anti-corruption system, the watchdog maintained its recommendation to withdraw investments, emphasizing insufficient evidence on how the system functions in practice. The fund, known for its strong environmental, social, and governance guidelines, views the corruption risk in Pemex as unacceptable, prompting the full divestment. This action underscores the fund's commitment to ethical investment practices and its influence on corporate governance globally.