NBIM opposes investor-backed ‘consultative’ climate proposal at TotalEnergies

Norway’s trillion-dollar fund joins Californian pension giant CalSTRS in rejecting non-binding Follow This proposal at French oil major, despite rare backing from ISS.

Norges Bank Investment Management (NBIM), the manager of Norway’s trillion-dollar sovereign wealth fund, has pre-disclosed that it will vote against the advisory climate proposal at TotalEnergies on Friday.

Unlike other shareholder resolutions filed by climate activist Follow This at European oil majors, the one at Total this year is “consultative”. This move was prompted by the French firm’s refusal to table a similar proposal in 2022 on the basis that it encroached on “the public policy competence of the board of directors to define the company’s strategy”. 

The non-binding nature of the new request appears to have been a major factor prompting ISS to support it – by contrast the influential proxy adviser is opposing a binding version of the proposal at Shell, which goes to the vote on Tuesday. 

ISS has supported Follow This before in its sustainability advice at European oil majors but has rarely supported its resolutions in its main advice. Responsible Investor understands that the only other time was in 2020 at Norwegian oil giant Equinor.     

The proposal at Total, which asks the French oil major to align its 2030 Scope 3 emission reduction targets with the Paris Agreement, was co-filed with 17 European investors, including Man Group, PGGM and MN.    

Its merit has divided Californian public pension giants CalPERS and CalSTRS, with the latter opposing it and the former supporting it.  

Both are, however, united in their rejection of the same but binding version at Shell, along with NBIM.  

All three have also backed all Shell’s directors up for re-election. This contrasts with a growing number of UK-based funds which have signalled their intention to vote against members of the oil giant’s board over climate concerns. 

Last week, Universities Superannuation Scheme (USS), the UK’s largest private pension fund by assets, said that it will vote against the chair of Shell’s board and the chair of its safety, environment and sustainability committee after losing confidence the firm’s decarbonisation efforts.  

“While Shell’s 2035 target aligns with a less-than 2C pathway, the company’s operating plans don’t show how it will achieve this,” a USS spokesperson said. “We’re also concerned with the company’s continued investment in new oil and gas production.” 

The announcement by the £91 billion ($113 billion; €105 billion) fund, which is also supporting the Follow This proposal at Shell this year, followed similar announcements by UK pension schemes Nest, the Church of England Pensions Board, Brunel Pensions Partnership and London CIV.  

NBIM did not reply to a request for comment. 

Last week, it provided details on its first climate proposals, revealing that it filed at four US companies this proxy season.