This move underlines the nation’s ongoing commitment to consumer safety as it considers ushering in an open, competitive gambling market
Norway’s sovereign wealth fund, the largest in the world with assets totaling $1.8 trillion, will closely examine crypto companies and gambling operators for possible ethical infractions. According to a recent Reuters report, the investigation, led by the fund’s Council on Ethics, will focus on ensuring compliance with ethical standards. These efforts could result in penalties for companies failing to meet these guidelines.
Crypto and Gambling Are High-Risk Sectors
The Norwegian fund, with stakes in nearly 8,700 companies around the globe and owner of 1.5% of all listed shares, operates under a strict ethical framework. Its Council on Ethics continuously screens the firms within its portfolio to ensure they maintain responsible practices. Non-compliance by a company could result in the Council recommending exclusion or placing the company on a public watchlist.
In its agenda for 2025, the Council on Ethics will prioritize reviewing investigations into companies dealing in cryptocurrency and gambling operators, as the sectors carry significant money laundering risks. Among the fund’s holdings in these areas are a 0.83% stake in Coinbase worth $453 million, a 2.13% stake in Flutter Entertainment valued at $691 million, and a 0.87% stake in MGM Resorts amounting to $121 million.
The Council has stated that these investigations aim to address concerns over ethical compliance and the societal impact of these industries. Potential divestment, if recommended, could take weeks to months to complete, minimizing market disruptions. Companies under scrutiny may be asked to amend their practices or engage directly with the fund to resolve concerns.
This Move Could Pave the Way for More Reforms
This initiative aligns with Norway’s broader commitment to sustainability and ethical governance across many sectors. Norway currently has a state-controlled gambling monopoly overseen by two operators, Norsk Tipping and Norsk Rikstoto, which oversee lotteries, sports betting, and online gaming. However, calls for reform are gaining momentum.
The Conservative Party recently submitted a plan in its election manifesto to move toward a fully licensed gambling market, to be implemented by 2028. Supporters argue that the liberalized market would increase consumer protections, reduce black market activity, and generate more tax revenues. Norway aims to emulate its Scandinavian neighbors who have benefited from a liberalized industry.
The ethical investigations and potential gambling reforms highlight Norway’s intent to balance economic benefits with social responsibility. By preemptively tackling the risks associated with cryptocurrency and gambling, the Norwegian sovereign wealth fund shows its commitment to ethical investment while paving the way for the possible liberalization of the nation’s gambling industry.
