But when you take a longer-term view, you make fewer decisions; the fewer decisions you make, the better they tend to be.

You know, if you make one decision a month, it tends to be better than if you make 10 a

day. Good afternoon, everybody. Uh, welcome to another session of Goldman Sachs Talks, and I'm delighted to be joined

today by the CEO of Norges Bank Investment Management, Nicolai Tangen. So first of all, let's welcome Nicolai to

Goldman Sachs. So Nicolai is responsible for the management of the Government Pension Fund Global—it's the world's largest sovereign

wealth fund—owning about 1.4% of the world's listed companies. Nicolai also

runs the daily operations of Norges Bank Investment Management. He was previously the chief executive officer and chief investment officer of AKO Capital, one of

Europe's top investment management firms. Nicolai founded AKO Capital and also established the AKO Foundation, which

aims to support education, promote the arts, and combat climate change. We're obviously going to talk to Nicolai about

Norges Bank, how investments can drive change, leadership, and what he's learned from some of the top leaders in the

world from your podcast. So, um, I'm looking forward to talking about that. And so, if it's okay, we're going to kind

of jump right in. So, cool. Okay. Well, so you're coming up on your fifth-year anniversary as CEO of Norges Bank

Investment Management, Norway's $1.7 trillion investment fund, and the fund is up 60% since you took over in

2020. Talk about the responsibility of stewarding, you know, a pool of capital this large. Talk a little bit about how

you kind of think about that responsibility and how it's kind of framed the way you've tried to set this

Over the past five years, yes, it's a, you know, it's a big responsibility because it's a, it's such a big fund for

a very small country. And um, despite us only using 2.5% of the fund every

year, it provides more than 20% of the state budget. And we have on our website a ticker, which is the live value of the

fund and is updated 13 times per second. So, pretty much live, and it's the most watched number in the country, so

everybody is focusing on it. So, big responsibility, but it's made easier by the fact that we have a mandate, a really

really good mandate, which is, uh, basically made by the Ministry of Finance, and it's got broad political

uh, it's broadly politically anchored, so all the political parties agree with what we're doing. It means that they will

not change their mind at the wrong time, and so that's good. And then also, of course, I don't do it on my own. We are

700 people, a really, really great team, and um, and then, you know, um, yes, there are a lot of zeros in, uh, you know,

19,000 billion Norwegian kroner, but you don't really think about those numbers, right? You think about doing the right

thing, doing the right processes, and then the numbers will follow. Yeah, I, I know that some of the guiding principles

are to be long-term oriented and diversified, but talk a little bit about how you decide where to invest, yeah, and

how do you decide where not to invest? Yeah, so um, again, the ministry has this mandate, um, and but at the same time, we

have to do it in a, in a, you know, ethical way. So we have a separate Council of Ethics which decides where we cannot

invest. We don't invest in coal, weapons, and so on, and there are some countries where we don't invest, and so

Uh, you know, that's kind of the broad picture. We are very diversified.

We own some 9,000 companies across the whole world. In Europe, we own

a bit more, close to 2.5 to 3%, across Europe. Yeah, yeah. So, so I

know that one of the things that you've said repeatedly is you really aim to be the most transparent

investment fund in the world. Talk a little bit about the benefits of transparency when you're running an

investment pool like this, and how you think about transparency as a principle. Yeah, to me, transparency is

totally key. Transparency increases trust. You know, the more your clients can see, the more they trust

you. We disclose every holding we have twice a year, and we are the most transparent fund in the world. There's

actually a world championship in transparency. Is there? Yeah. And for a period of time—I didn't know that—that's

that's the sport I'm doing. Uh, for a while, the Canadians were number one, and I thought, 'Hey, it's fine that the

Canadians beat us in ice hockey, but it's not fine that they beat us in transparency.' Well, I don't know that it's

really fine that they beat you in ice hockey. But so, so last year, for the first time, we became the world

That's awesome. Yeah, I want to talk a little bit about climate because I know it's an area of focus for

you. Talk a little bit about the private sector, the role the private sector should play, the role investors play when

it comes to the environment and sustainability. Do you—do you see—how do you think about the long-term investment?

opportunity around these long-cycle transition issues. Well, so we care about climate because it is a financial

risk. We see it now in a lot of the commodity prices; you see it in

you know, coffee, olive oil, orange juice—all these kinds of things where, you know, the prices are going up because harvests

are worse because of the climate. So they are—so climate and the financial market is linked in a

different way than it has been before. Um, so we spend a lot of time working with our companies, making sure they do the right thing on

climate. I appreciate there's been a backlash in the US; we haven't really seen that to the same extent in Europe

and for sure in Norway. We continue to have the same opinions as we've had before. I think there are investment

opportunities in that space as well now, which are better than before. We got the opportunity to invest in

renewable infrastructure four years ago, and in the beginning we were just like really, really slow because we thought

the returns were too low, too many people changing the deals. But now that's changed, so we think there are better

returns in the space. There's a bit more supply, so you can deploy more capital, and we have beefed up the team and are

doing more than that in renewable infrastructure specifically, or more broadly. Let's talk a little about your, your five

years in kind of frame for me. What are, what are a handful of key accomplishments in these first five

years, and what are a handful of the most important learnings? Yeah, um, yeah. So first of all, it's it's not me,

right? It's about the big team. But what have we focused in on? Well, we focused in on performance, of course.

because without performance, we have no reason to be, um, and it's very much about learning from mistakes. It's we've

created this, uh, investment simulator where all the data from every PM is up in the cloud, and when you want to

make a decision, you get it all fed back to you—all your weaknesses, all your bad habits. You know, are you normally, uh,

selling losers too late? Are you selling winners too early? When you trade, you basically get all these signals fed back to you, and so

that's been a big development, which is now starting to change investment behavior. It's really cool. Very good. Um,

we're also working on getting people to be more contrarian in the trades they do and more long-term. You know, the most

difficult thing is to be long-term. Why is it so difficult? Why? You come to work on a Monday, and it's just like you come

home and you tell your husband, you know, and he asks you, "What did you do today?" Well, I did nothing. You know, Tuesday,

nothing; nothing; Wednesday, nothing; Thursday, nothing. You know, you don't feel great about it, and so sometimes the best

thing is not to do very much, but it's very profitable. You know, compounding is just amazing. Compounding, compounding is

a powerful thing. On that investment side, on the people side, more development of people; we are

recruiting—we are recruiting better people. On the communication side, much more transparency, more internal communication, more external

communication; and then operational robustness, better and, you know, more focus on cyber. So we've just done a

lot. Thank you. You're a shareholder. You mentioned 9,000 companies. I know Goldman Sachs is one of those companies; we

appreciate that. We thank you for all your hard work. We're working—we're working hard—and because you guys are

We're working hard. We're working hard. What, um, let's talk a little bit about investor dialogue. What makes for

an effective investor dialogue, and how important is investor dialogue for you with respect to the companies? It's very

very important. Um, we have more than 3,000 meetings a year with our companies. We, uh, you know, we turn up at nearly

10,000 AGMs. We vote on, uh, 120,000 proposals. We know we've got to be a big

machinery, uh, doing this. I think the key is to have very clear expectations, and so we have this set up in, set out in

expectation documents. It's important to be consistent over time so that you, as a CEO, know that we are not like changing

our minds all the time. One of the things I found very interesting about our dialogue with you is, you know, I, I would

say, you know, your team, when they deal with us, they are deep in the weeds—deep in the weeds—um, on really trying to

understand how we're thinking about things. Do you—how do—do you do that by industry sector? Do you do that? How do

you do that? In the context of, we have—we have industry sectors. We've got some really strong sectors. I think our banking team

is, uh, is really superb. Um, so that's how we do it. Now, you know, there are two ways

you can deal with problems as an owner. You can just—you can sell your holding, or you can go into a dialogue.

Now, what—what kind of problem do you solve by selling your holding? Nothing. You know, let's say now you have a

company which is doing, you know, not so good stuff on climate. You sell; everybody sells the holding. What happens? Well, you

the company ends up in the hands of people who don't care, you know, so it's just not good. It's better to hold it and

to talk and to advocate and to engage; it's like when you feel like when you have a problem at home, you can just...

kind of sell off, or you can try to fix it. That's the—try to fix it is a better

strategy, often. Yeah, listen and understand first. Yeah, yeah. So in the first half of 2024, your fund posted

$138 billion in profit, largely on the acceleration of large-cap tech. Talk a little bit—let's talk a little

bit about AI. Yeah, kind of the future of AI investment. What what are some of the risks of concentration in the market? I

mean, at the moment, you know, when you you look at kind of the large-cap indexes and what's going on, you have enormous

concentration, and if you're not, you know, overweighted to this handful of stocks, you're going to underperform. Talk a

little bit about how you're thinking about...

Yeah, it's a—it's a level of concentration we've never seen before,

How 700 people manage 1.5% of all listed companies worldwide | Norges Bank Investment Management

Norges Bank Investment Management manages the Norwegian Government Pension Fund Global, often referred to as the Oljefondet, NBIM or Statens Pensjonsfond Utland (SPU). The aim of the fund is to ensure responsible and long-term management of revenue from Norway’s oil and gas resources so that this wealth benefits both current and future generations of Norway. 

Our objective as manager of the fund is to generate the highest possible return on the fund. We aim to achieve this in a safe, efficient, responsible and transparent manner, and within government guidelines. 

We have offices in Oslo, London, New York and Singapore. Our global presence brings us closer to the markets we invest in and ensures stronger links with partners in different parts of the world. 


How 700 people manage 1.5% of all listed companies worldwide | Norges Bank Investment Management

How 700 people manage 1.5% of all listed companies worldwide | Norges Bank Investment Management

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