Climate change isn’t just warming the planet and impacting ocean levels, but opening up a new world of financial challenges, according to Nicolai Tangen, the hedge fund manager tasked with overseeing Norway’s $1.8 trillion sovereign wealth fund. Food inflation, for example, is “now linked to climate in a different way,” said Tangen, who serves as CEO of Norges Bank Investment Management, yesterday (Jan. 22) while speaking at the 2025 World Economic Forum in Davos, Switzerland.
“The reason we care about climate at Norges Bank Investment Management is because it is a financial risk,” said the hedge fund manager, who pointed to climate change’s link to food prices, alongside its other impacts on areas like immigration, conflicts and even productivity. “We are seeing worse harvests. We are seeing impact on olive oil prices, coffee, cocoa and so on,” he added. “It’s just a totally different picture here than has been the case in the past.”
Tangen, who founded the investment firm AKO Capital, was named head of Norges Bank Investment Management in 2020. The organization manages the largest sovereign wealth fund in the world. Originally established to invest Norway’s oil revenue, the fund’s holdings include stakes in around 9,000 companies worldwide, about 1.6 percent of all publicly traded companies.
It is also an advocate for environmental, social and governance (ESG) agendas—an area that is expected to be scaled back on under the Trump administration. Earlier this week the returning President withdrew the U.S. from the Paris Climate Agreement and pulled back on DEI programs across government agencies. “We do not agree that one should roll back climate efforts, that one should stop looking at diversity issues,” Tangen said in a Reuters interview yesterday (Jan. 23) where he described such actions as “negative in the long term.”
Contrarian advice on buying tech stocks
In a separate interview with Bloomberg this week, Tangen also advised enterprising investors to go against the grain by buying stocks that are “out of fashion,” such as holdings in China, and sell U.S. tech stocks and private credit. “The best thing to do is always the opposite of everybody else,” he said.
Such contrarian behavior isn’t without its risks. “There will be periods where you underperform and everybody is going to question your sanity,” said Tangen, who has historically advocated for a diversified and long-term approach towards investing. Norges Bank Investment Management a major tech stock investor with nearly $174 billion worth of holdings in Alphabet, Meta, Microsoft, Amazon, Apple and Nvidia. Earlier this year, Tangen called the concentration of A.I. companies in the market “absolutely worrying.”
