Norway’s $1.4tn wealth fund, the largest sovereign fund in the world, said on Friday it would back activist resolutions calling for US oil giants Chevron and ExxonMobil to cut their emissions.
The resolutions will be put to Chevron and Exxon shareholders during their respective annual general meetings (AGMs), which will be held on Wednesday. The proposals, initially brought by activist shareholder group Follow This, call on the companies to include their Scope 3 emissions in their environmental and climate plans, which currently only consider emissions from production activities.
The Norwegian wealth fund also said it would vote against the appointments of Chevron and Exxon CEOs and other senior management.
Follow This founder Mark van Baal said: “The fund has a huge responsibility. This voting jeopardises their credibility as stewards of the global economy. They are saying to Shell, BP and Total: you don’t have to reduce your emissions this decade. We expect them to correct this oversight next year.”
Carine Smith Ihenacho, the fund’s chief corporate governance officer, told the Financial Times: “Exxon doesn’t really believe in the value of setting Scope 3 targets. We think the company should do so. Chevron, we don’t think they are ambitious enough in their transition plans.
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“Our job in the fund is to create value for future generations but in a responsible way.”
This is despite BP’s reduction of its climate pledges. In 2019, the company set a target to cut its emissions by 40% by 2030 compared with 2019 levels. Following record annual profits for the oil and gas industry in February 2023, this was diluted to just 20%-30%. This is far out of line with the Paris Agreement, which calls for global emissions cuts of 45% by 2030.
A Follow This resolution put to TotalEnergies in its AGM on Friday was rejected but received a 30.4% backing from investors, up 17% from a similar climate vote in 2020. TotalEnergies’ internal climate plan, which proposes more modest emissions cuts, was approved with 89% of votes. The Norwegian fund voted against the TotalEnergies resolution.
When the company added the climate resolution to its AGM, it recommended that investors reject it, stating that the company “cannot be held responsible for the reduction of emissions related to the use of [its] products by its customers”.
Van Baal told the Financial Times that the group welcomes backing from the oil fund but was “surprised” that the group didn’t back similar resolutions put to European oil companies.