Norway’s sovereign wealth fund, the 7.8 trillion Norwegian kroner (850 billion euro) Pension Fund Global, is planning to put pressure on the companies in which it invests to demonstrate “appropriate, prudent and transparent” tax behaviour.

According to an ‘expectation document’ published on its website, it will seek to prevent companies from trying to “excessively” optimise taxes with “aggressive” behaviour, or shifting profits to countries where they have little or no real economic activity.

Norges Bank Investment Management (NBIM), which manages the fund, argues that ”maximising long-term value does not require aggressive tax behaviour”.

It adds that ”boards should ensure strategic decisions are driven by long-term value creation” and that ”corporate culture should inculcate consistent tax behaviour across the organisation”.

NBIM chief executive officer Yngve Slyngstad, speaking with Aftenposten, Norway’s largest printed newspaper, conceded that companies and investors ”will, of course, try to not pay more tax than necessary”.

Asked about the prescriptive nature of these recommendations and the open question as to where the line should be drawn on ”aggressive” tax behaviour, he said it must be within “acceptable, normal practice and what the countries (where revenues are generated) believe are reasonable means of handling tax questions”.

The oil fund’s management of real estate investments through subsidiaries in Luxembourg and Delaware, which have drawn public criticism precisely for their tax practices, falls into this category of ”acceptable market practice”, according to Slyngstad.

”Our starting point in our (expectation document) is, of course, that companies can minimise their taxes,” he said, ”but not go so far in their tax planning that it would be called ‘aggressive’.”