London/Oslo — One of the asset managers co-leading climate talks with Equinor on behalf of more than 600 investors said it has sold its stock because the oil major’s board failed to align its strategy with the world’s goal of limiting global warming.
After first investing in Equinor in 2021, Britain’s Sarasin & Partners helped lead talks with the company as part of the Climate Action 100+ initiative, whose members push the world’s largest listed corporate polluters to cut emissions.
Despite originally seeing Equinor as a “potential leader in the energy transition” that would “set a standard for the industry”, a March 14 letter to the company seen by Reuters said it had failed to align its strategy with the Paris Agreement.
That landmark deal, agreed by countries including Equinor’s majority owner Norway, seeks to limit the global average temperature increase to well below 2 degrees Celsius above the pre-industrial average by mid-century, and ideally 1.5 degrees.
Despite making statements supporting such a pathway, “Equinor has not revised its strategy to deliver on these”, the letter to Equinor Chairman Jon Erik Reinhardsen said.
“Instead of leading the transition, Equinor has followed other oil and gas majors in rolling back its efforts,” it said, including by lobbying to expand oil and gas production, and cuttings its renewable energy target in February.
Equinor said its strategy remained firm, but as the energy transition was moving slower than it expected, it had to adapt its speed of transition to markets and opportunities.
“Our ambition is to be a leading company in the energy transition, and as an example of this leadership, we are now preparing to receive the first shipment of CO2 at the Northern Lights transport and storage facility,” said an Equinor spokesperson.
Northern Lights is a carbon, capture and storage (CCS) facility on Norway’s west coast, Equinor completed last year, jointly with Shell and TotalEnergies.
PARIS AGREEMENT
Sarasin co-filed a shareholder resolution in 2024 asking Europe’s biggest supplier of natural gas to align with a 1.5-degree pathway, yet it was successfully opposed by the board.
The asset manager said in its letter that it was particularly troubled by Equinor’s view that it was already aligned with the 1.5 degrees Celsius climate goal, calling the claims “not credible”.
“It is clear from public statements that Equinor assumes it could become aligned if the world transitions more quickly, but this is a fundamentally different position from actually supporting such a pathway today,” it said.
Sarasin’s holding peaked at around 9.5 million shares in March 2024, making it among the company’s 20-biggest investors, before it began reducing its position in May. When it sold out in January, it had around 3 million shares.
Equinor said it considered its strategy was compatible with the transition to a sustainable economy in line with the goals of the Paris Agreement.
“We reduce emissions from our operations in line with science-based trajectories, we invest and take actions to advance decarbonisation and transformation,” said the Equinor spokesperson.
Equinor said it disagreed with Sarasin over the methodology Climate Action 100+ uses. “We have had and continue to have dialogue with them on this topic,” said the Equinor spokesperson.
Reporting by Simon Jessop in London and Gwladys Fouche in Oslo; Editing by Kirsten Donovan and David Evans – Reuters
