World’s Largest Sovereign Wealth Fund Embeds AI Into Portfolio Management
Norway’s $2.1 trillion Government Pension Fund Global has embedded artificial intelligence into its portfolio’s risk management, according to its 2025 “Responsible Investment” report. Norges Bank Investment Management, which oversees the world’s largest sovereign wealth fund, revealed it is using large language models to screen all portfolio companies and conduct deeper analysis.
“Artificial intelligence is changing how we work as an investor,” Norges Bank CEO Nicolai Tangen wrote in the report. “New tools help us analyze risk, assess investments, and evaluate our company engagement. It improves decision-making across our large and diverse portfolio.”
According to the report, the GPFG’s AI tools have been particularly useful in evaluating and researching small-cap companies in emerging markets, which tend to have little data vendor coverage and get limited attention from media outlets. The GPFG stated that a lack of in-depth research—often the case prior to significant AI improvements—could cause the investor to miss controversies that point to systemic failures in risk management.
“We always review the information before we make an investment or risk decision,” the report stated. “In multiple instances, we identified and sold these investments before the broader market reacted to the risks, avoiding potential losses.”
As part of its AI-driven risk management, Norges Bank reported the AI tools are also being used to quickly flag companies in its equity portfolio that could potentially violate its ethics policies, such as because of corruption and fraud, or because of the use of forced labor. The sovereign fund receives AI-generated risk assessments daily for investments made the previous day, which, the report states, allow Norges Bank personnel to evaluate material information and mitigate actions immediately, if necessary.
In addition to risk management, Norges Bank reported using AI to improve its analysis of its portfolio companies’ environmental, social and governance records. The fund screens potential initial public offerings for sustainability and governance risks, according to the report. Norges Bank stated that its AI tools make sustainability issues part of its investment process from the first stages of the investments.
“Active investing requires deep company understanding,” Daniel Balthasar, Norges Bank’s co-CIO for active strategies, wrote in the report. “When we analyze businesses, governance and sustainability are not separate considerations—they are central to assessing competitive advantage.”
Norges Bank reported that its portfolio managers attended 3,078 meetings with companies in 2025 and discussed governance and sustainability topics at 45% of them.
“Understanding the views of the company board or management improves the quality of our investment analysis and makes our responsible investment efforts more relevant,” the report stated.