The Norwegian government said on Wednesday it would assess the impact of climate change on financial markets and urged global investors to join forces.

The finance ministry will undertake the study in its role as owner of Norway's $350 billion sovereign wealth fund which invests the country's oil wealth in overseas stocks and bonds.

Climate change can have wide-ranging consequences for the world economy and financial markets, Finance Minister Kristin Halvorsen told a seminar.

She encouraged other large institutional investors and industry leaders worldwide to join in the project.

Together we need to develop the tools and critical thinking that are required to understand the financial implications of climate change, she said, announcing the study to be conducted with consulting firm Mercer.

Norway's Government Pension Fund -- Global, commonly known as the oil fund, is the world's second biggest sovereign wealth fund after that of the United Arab Emirates and says it is the biggest equity investor in Europe.

The ministry said in April it was preparing to put 20 billion crowns ($3.24 billion) over five years from the fund into companies engaged in environmental technologies in emerging markets.

The program will aim at investments yielding environmental benefits, such as climate-friendly energy, improving energy efficiency, carbon capture and storage, water technology, and waste and pollution management.

The oil fund, which was worth 2.196 trillion crowns ($355.3 billion) at the end of April, said in April it has had a roughly zero percent return on its investments in global stocks and bonds so far in 2009 after a dismal 2008.

The fund is under increasing scrutiny in Norway after reporting a negative return of 23.3 percent on investments last year -- losing nearly $90 billion -- and missing its benchmark portfolio by 3.4 percentage points.

(Reporting by Aasa Christine Stoltz, editing by Mike Peacock)