​Norges Bank governor admits did not foresee storm over Tangen

first_img“We note that there have been violations of guidelines, rules and laws”Julie Brodtkorb, the leader of Norges Bank’s supervisory councilIn his introductory statement, Olsen said he understood the supervisory council’s desire to remove risk, but that any company board had to make trade-offs between different types of risk.“With the agreement that has now been established, the executive board believes that we have stopped possible conflicts of interest,” he said.Other points of contention raised at the hearing included the use of tax havens by parts of Tangen’s finance empire surrounding his main firm AKO Capital.While Brodtkorb repeatedly warned of the danger of undermining confidence in both Norges Bank and the GPFG, Olsen pointed several times to Tangen’s qualities and experience which he said had set him far above any other candidate for the CEO job.“He has unique experience gained from international asset management and can point to impressive results. At the same time, he is an innovative and committed leader with a deep understanding of the strategic challenges facing the oil fund,” Olsen said.The finance committee is now due to compile a report on the matter by 21 August, just days before Tangen is to take up his new job as NBIM CEO on 1 September, replacing long-term incumbent Yngve Slyngstad.While the parliamentarians do not have power to prevent Tangen’s appointment, any politically broad-based criticism of Norges Bank’s leadership could nevertheless put it under strain. Parliamentary overseers say laws were broken in the SWF chief hiring.Looking for IPE’s latest magazine? Read the digital edition here. The governor of Norway’s central bank was grilled by parliamentarians this afternoon about his handling of the highly-controversial hiring of hedge fund billionaire Nicolai Tangen as the new leader of the country’s NOK10.3trn (€970bn) sovereign wealth fund.Answering questions in a finance committee hearing, Øystein Olsen said: “We were aware that the appointment would attract attention. But, well, we did not foresee this whole storm that has happened.”Olsen’s testimony to the cross-party panel followed that of Julie Brodtkorb, the leader of Norges Bank’s supervisory council.She told the politicians that despite complex efforts made by the bank and Tangen to separate him from his vast financial interests during his coming tenure as CEO of Norges Bank Investment Management (NBIM), the risk of conflicts of interest was still there. Brodtkorb referred to ethical guidelines for employees of Norges Bank which stated that staff could not have personal interests which could cause conflicts of interest or which could be perceived as giving rise to such conflicts.She said Norges Bank had made a written assurance that the risk of conflicts of interest between Tangen’s personal wealth and his role as leader of the Government Pension Fund Global (GPFG) had been, for all practical purposes, eliminated.“The supervisory council does not share this opinion,” she told the committee, which had co-incidentally been convened on Tangen’s 54th birthday.Asked by the committee’s leader, Labour Party member of parliament Hadia Tajik, about the handling of the appointment by Norges Bank’s executive board – which Olsen leads – and how it could affect the GPFG’s reputation, Brodtkorb said:“We do not want to give opinions or make statements about what the consequences are, but we note that there have been violations of guidelines, rules and laws.”last_img

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