Nicolai Tangen visits New York City

Change in the Sovereign Wealth Fund


Photo: Ole Berg-Rusten / NTB
Nicolai Tangen has served as CEO of Norges Bank Investment Management since September 2020, tasked with managing the Norwegian Sovereign Wealth Fund, commonly known as the oil fund.

Business & Sports Editor
The Norwegian American

Peter Parker, aka Spider-Man, is advised by his uncle that “with great power comes great responsibility.”

That is kind of how Nicolai Tangen felt when he became CEO of Norges Bank Investment Management in September 2020. NBIM oversees the Norway Sovereign Wealth Fund, sometimes called the oil fund, as the receptacle for much of the money from Norway’s oil and gas industry. It is meant to sustain the welfare state in the present and future.

“I thought that I potentially could be the person who lost a lot of money,” he said in a presentation, Crisis? Being a Large Financial Investor in a World of Uncertainty, to Norwegian American Chamber of Commerce at Scandinavia House in New York City on Sept. 16.

“You have the richest person in the world. You have the first person who goes to the moon. You have, in tennis, the person who won the most Grand Slams. Then you have the person who loses the most money and is the biggest loser of all time. That could easily be me.”

In the first half of this year, the fund lost a record NOK 1.68 billion. There were a variety of factors. Industry-wise, technology was a sector that affected the decline. COVID, of course, reared its head. There were changes on the political scene.

“Imagine a situation where you, as an investor, lost, say, 15% of all the assets,” he said. “Well, that’s exactly what happened in the first half (of this year) after having had a period of really, really strong performances over a whole series of years. Due to the geopolitical situation, we had a steep decline.”

There was a lot of purchasing by investors and consumers. “In the first half of the year there were higher interest rates,” said Tangen. “These assets are long-duration assets, investments in the future. There was also a lot of pre-buying (going) on technology investments in 2021 during COVID. Among consumers, there was a lot of buying of washing machines and home appliances. And 2021 was very strong. In 2022, you had a pullback in expenditures and industrials, with higher interest rates. People are afraid that there will be a slowdown coming. Stocks reflect future value, future companies’ incomes, so that made them pull back.”

There are positive developments. Tangen says the Ministry of Finance has provided them with a “great mandate, that we should invest roughly 70% equities and 20% bonds, which for the long term, is fantastic. It means that we will go through periods where we have less return.”

Energy made a recovery and oil and gas companies in worldwide markets started earning more money, but this led to high inflation rates in the United States and worldwide. The fund made adjustments, taking advantage of their years-long research and analysis into ways to protect the fund. They investigated other industries in which to invest. They are careful on initial offerings of stock and changed the terms and length of bonds. The fund purchased insurance to protect against high inflation and oil prices.

On the geopolitical front, after two decades of relative calm, there have been significant developments: ceasing of globalization; the higher expense of producing goods in the United States than China; climate crisis, which is forcing a search for new ways of producing power, which will likely lead to higher power prices. All of these are inflationary and not likely to change in the next 10 years with “a lot of geopolitical uncertainty.”

To a question about dealing with companies that might be climate polluters, Tangen noted, “We have conversations with them. We also do an ESG [environmental, social, and corporate governance] risk-based investments, divestments score. If companies score badly on our test, we divest of them. We’ve had more than 300 divestments since we started this. We think climate is now an integral part of all the risk factors.”

Tangen says the fund’s real employers are the Norwegian people and politicians, with whom they must build trust. It’s essential that the fund be transparent. This has taken the form of more visibility, appearances in the media, producing podcasts about the companies in which they invest. “There is a very close correlation between how much people know about the fund and how much they trust the fund,” he said.

“The key to running the fund well is essentially our employees, and you do work for the country,” said Tangen. “We have to attract the best people with solid knowledge and experience. We think we are quite successful in doing that. I’m very proud of the people I’m working with. They are of the highest ethical standards, very smart with their education and experiences. We work as a collective for a common goal. These employees are what make me feel quite secure about the future, despite all the turbulence we talked about. Having these top people build top processes and systems, we can stay ahead of the game and continue to do what we are supposed to do, which is this good.”

Tangen’s surprise answer to what to invest in drew a laugh and applause at the end.

“Over the next five to 10 years, you’re not going to make money anywhere,” he said. “We’ve had 25 years of uninterrupted growth. That’s not the way it is. It was easy to make money. You have a period now where there is a risk the rates will go higher. Therefore, you’re not going to make any money in the bond, stock, or even in the real-estate market. I think you should spend some of that money <laugh>. I have a degree in social psychology and spent time reading about happiness research. The best way to increase your happiness is to spend money on experiences with family and friends, not buy things. Invest in learning a new hobby. Spend time with people you love. That’s probably the best investment you can make.”

In 1991, when Nicolai Tangen was at the Wharton School at the University of Pennsylvania in Philadelphia, he tutored Michael Kleiner in Norwegian.

This article originally appeared in the November 4, 2022, issue of The Norwegian American.

Avatar photo

Michael Kleiner

Michael Kleiner, business and sports editor, has more than three decades of experience as an award-winning journalist and public relations professional. He has operated his own PR and web design business for small businesses, authors and community organizations in Philadelphia since 1999. Not of Norwegian descent, he lived in Norway for a year with his family at age 11 and has returned as an adult. He is the author of a memoir, Beyond the Cold: An American’s Warm Portrait of Norway, and a member of NorCham Philadelphia. Visit;