Norway's sovereign wealth fund put its investment in Astra International under review, over concerns about the environmental record of the Indonesian conglomerate's palm oil business.
Astra International is the latest group to run afoul of the environmental concerns which are leading the world's largest sovereign wealth fund to pull its investments in the palm oil sector.
Norway's $856bn Government Pension Fund is administered by that country's central bank, and comprises the revenues from North Sea oil fields.
The central bank on Tuesday said it was reviewing Astra International on recommendations from its council of ethics.
The Indonesian company, valued at around $18.5bn, has attracted attention for its palm oil operations, through a 79.7% stake Astra Agro Lestari.
The decision will give the company four years to meet the fund's ethical standards, after which the 0.3% stake, valued at $73m, will be sold.
Last year the council of ethics recommended that Astra International be excluded over the "unacceptable risk that the company is responsible for severe environmental damage as a result of its conversion of tropical forest into oil palm plantations".
In June, Astra International pledged to immediately end all forester clearing.
Following this move, the council of ethics revised its recommendation, stating that Astra International should be kept under observation.
The central bank has already decided that the sovereign wealth fund should divest itself from holdings in four of Asia's biggest companies, due to palm oil holdings.
Korean industrial group Daewoo, and its parent company Posco steel, as well as Malaysian conglomerates IJM and Genting, were excluded from investment in August because of their connections to the south-east Asian palm industry.
Ethical concerns over palm oil production have the potential to weigh on stock prices for palm companies.
Norway's sovereign wealth fund is restricted from investing in companies that fall short of certain ethical strictures.
More than 60 companies, including those that sell tobacco products or certain types of munitions, or contravene environmental standards, have already been divested or excluded from investment.
Palm oil production has drawn the attention of the fund because the land used for palm tree plantations, especially in South East Asia, may be reclaimed from virgin forest by land clearances.
Forest fires caused by illegal land clearing in Indonesia have been blanketing that country, as well as neighbouring Malaysia, with a thick lair of air pollution in recent weeks.
Ironically, this haze has disrupted the process of palm harvesting, which has reduced palm oil output in those countries.
By William Clarke