DEFINITION of 'Government Pension Fund (Norway)'

A fund made up of two separate Norwegian investment funds with different mandates: the Government Pension Fund – Global and the Government Pension Fund – Norway. The Government Pension Fund – Global is a sovereign wealth fund derived mainly from Norway's oil wealth. The Government Pension Fund – Norway was previously associated with Norway's social security system, but is now a sovereign wealth fund that invests strictly in Norwegian firms.

BREAKING DOWN 'Government Pension Fund (Norway)'

The Global fund is managed by Norges Bank Investment Management (NBIM), a part of the Norwegian Central Bank. It is one of the largest sovereign wealth funds in the world with approximately $443 billion in assets under management as of 2009. The Global fund invests in a wide array of asset classes and both domestically and internationally. Since 2004, the Global fund's investments have been restricted by an ethical council that has the power to exclude firms that are involved in objectionable activities. The Global Pension Fund – Norway is a much smaller fund and is limited to investing in domestic firms. Despite its smaller size, its limited investment mandate has led to the Norway fund being a large shareholder in many publicly-traded Norwegian firms.

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