Norges Bank's executive board has signed an employment contract for the new CEO of the world's largest sovereign wealth fund, following investigations into potential conflicts of interest.
Nicolai Tangen will become CEO of Norges Bank Investment Management, the in-house manager of the 10.4 trillion Norwegian kroner ($1 trillion) Government Pension Fund Global, Oslo, effective Sept. 1, according to a notice published on the central bank's website.
Mr. Tangen founded the $17 billion hedge fund AKO Capital in 2005, "and has since acquired substantial wealth," the notice said. His ongoing association with the London-based firm had been investigated by the central bank's supervisory council.
"The employment contract creates sufficient distance between Nicolai Tangen's private finances, the AKO system and the job that he will carry out as CEO of Norges Bank Investment Management," Oystein Olsen, governor of Norges Bank, said in the notice. "Mechanisms are established which ensure that Tangen will have no influence on his fund investments for as long as he is employed by Norges Bank, and which prevent possible conflicts of interest and impartiality."
Under the employment contract, Mr. Tangen's voting right in AKO Capital has been reduced to 43% and a trustee has been appointed to exercise his voting rights. His previous voting right could not immediately be learned. Mr. Tangen will step down from all directorships in AKO companies, and all relevant boards of directors have been "changed so that they do not have a majority of members with close ties" to Mr. Tangen, the notice said.
All dividends related to his ownership of AKO Capital will be donated to the AKO Foundation, London. The foundation, which supports charitable causes that seek to improve education, promote the arts or mitigate climate problems, was established in 2013 by Mr. Tangen. The foundation had total funds of £120.5 million ($158 million) as of Dec. 31.
Mr. Tangen's personal wealth in the AKO strategies will be managed by Norwegian manager Gabler Investments SA. All dialogue will be handled by a proxy. "This means that Tangen will not know what he is invested in, and it ensures that unwanted information is not received by Tangen," the notice said.
Finally, for six months after leaving the AKO role, Mr. Tangen cannot provide services to or take up directorships within the AKO system.
"With Nicolai Tangen, we will have a highly skilled leader of the Government Pension Fund Global. Tangen is a man with good leadership skills and unique experience from international capital markets. Tangen will take a competent organization to new levels in the years to come," Mr. Olsen said.
Mr. Tangen's annual salary will be 6.65 million kroner ($672,000), according to a document published Thursday by the central bank.
Mr. Tangen will replace Yngve Slyngstad, whose resignation was announced last year. Investigations had also taken place regarding the relationship between Messrs. Tangen and Slyngstad, after it emerged that Mr. Slyngstad had accepted a flight paid for by Mr. Tangen, following his attendance at a conference also arranged by Mr. Tangen. Mr. Slyngstad was cleared of an ethics breach in April.
