Oslo — Norway’s sovereign wealth fund, the largest in the world, has been pulled into the country’s parliamentary election as pressure grows to sever its financial ties with Israeli companies. What began as a question of ethical investment has widened into a political storm, raising uncomfortable questions about Israel’s conduct abroad and the fund’s ability to remain neutral.
The $2 trillion fund, managed by Norges Bank Investment Management, has in recent weeks shed stakes in 23 Israeli firms, including one that manufactures engines for the Israeli military. Its holdings in Israel have now shrunk to 38 companies worth nearly 19 billion Norwegian crowns, down from 61 at the end of June. On August 18, the fund said it would exclude six more firms linked to activities in the occupied West Bank and Gaza. Earlier this month, it terminated contracts with outside managers overseeing Israeli assets, citing a need for tighter control over compliance with its ethical guidelines.
Yet these measures have done little to quiet the political backlash. The Socialist Left party has made the fund’s role a central issue in the September 8 election campaign, calling for a total withdrawal from companies connected to Israel. Party leaders argue that Norway cannot credibly speak about human rights while maintaining investments in businesses profiting from Israel’s ongoing genocide in Gaza. Labour, which leads the governing coalition, has resisted a blanket ban, insisting the fund must remain insulated from political winds. Nicolai Tangen, the fund’s chief executive, has warned that the institution is facing its “worst crisis” in its history as its reputation for neutrality erodes under the scrutiny.
The controversy has drawn attention not only to the Gaza genocide but also to Israel’s record of interference in foreign politics. European intelligence services have documented cases where Israeli-linked firms attempted to sway elections through covert operations and disinformation campaigns. In France, investigations around the 2017 presidential race uncovered Israeli digital contractors accused of spreading manipulated content. In Eastern Europe and parts of Africa, Israeli private intelligence companies were exposed for marketing “election manipulation for hire.” Psy-Group, a now-defunct Israeli firm, openly pitched services to tilt campaigns abroad. In the United States, congressional hearings have long scrutinized the power of Israeli lobbying groups and cyber operations, with accusations that policy debates are often bent toward Tel Aviv’s interests.
Critics in Norway argue that continuing to hold Israeli shares not only ties the country to the Gaza genocide but also to a government and network of firms repeatedly accused of undermining democratic processes abroad. “We are being asked to keep investing in a state that has perfected the art of manipulation,” one Socialist Left lawmaker said, pointing to a growing body of reports about Israeli companies influencing elections from Washington to West Africa.
For Norway, often held up as an international model of ethical investment, the implications are profound. Decisions taken in Oslo will resonate far beyond its borders, as other sovereign wealth funds face increasing pressure to justify their exposure to conflicts and regimes accused of violations. The question is whether a fund built to safeguard the nation’s future can continue to turn profits from companies accused of fueling the Genocide of Palestinians in Gaza and manipulating democracies.
According to Reuters, which reported the extent of the fund’s divestments, the dispute has transformed one of Norway’s most respected institutions into an election battleground, testing whether financial stewardship can be separated from the growing evidence of Israel’s destructive reach into both war and politics.
