Chris Hohn hits out at NBIM for failure to file shareholder resolutions

Hedge fund heavyweight Chris Hohn deems regulation 'only solution' to curb corporate emissions.

Hedge fund manager Chris Hohn has criticised Norges Bank Investment Management’s (NBIM) track record on shareholder resolutions, arguing that activists should not be left isolated in the fight for climate change.

Hohn, who heads The Children’s Investment Fund (TCI), made the remarks during a panel at Bloomberg’s ESG Investment Forum on Thursday.

“Norges has to file more AGM motions and should be asking regulators to mandate corporate climate strategies,” said Hohn, who was sharing the stage with Carine Smith Ihenacho, chief of compliance and governance at NBIM.

Despite an increase in climate pledges in recent years, Hohn said the investment community needs to move from “plans” to “actual performance”. He noted that engagement has not achieved the necessary reduction in corporate emissions, which on the contrary continue to rise.

“It comes down to pressure,” Hohn added. He claimed that some investors are too scared to use harsher mechanisms such as shareholder resolutions to hold boards to account.

In response, Smith Ihenacho said NBIM does a lot of engagement behind the scenes and discloses, where possible, its voting intentions five days prior to a company’s AGM.

In response to Hohn’s question about how many shareholder resolutions NBIM filed this AGM season, however, Smith Ihenacho admitted that none were filed on behalf of NBIM.

“Why is it just us [charities, non-profits and activists] doing the heavy lifting?” continued Hohn, who also highlighted the greater costs to companies if carbon emissions keep rising.

Hohn, who has built a reputation for proxy voting contests and high-level activist campaigns, urged investors to vote against directors in the fight for climate change. “Sacking is the only thing they listen to,” he said.

On that note, Smith Ihenacho said activist tactics do not work in every market but that NBIM has voted against chairs of sustainability committees if climate plans were deemed insufficient.

NBIM is one of the largest asset managers in the world with $1.4 trillion in assets, owning almost 1.5 percent of all shares in the world’s listed companies.