Financial backers questioning Equinor's adherence to the Paris Agreement prior to the Annual General Meeting (AGM)
In the lead-up to Equinor's Annual General Meeting (AGM) on May 14, 2023, the Norwegian oil and gas supermajor finds itself under increased scrutiny from its investors. One such investor, Sarasin & Partners, has divested from Equinor, selling its remaining £3m stake after previously reducing its holding.
This divestment by Sarasin & Partners, a firm managing around £18.5bn, is not related to the AGM but rather follows Equinor's announcement in February 2025 regarding its plans to increase oil and gas output. The firm's decision was based on Equinor's refusal to reduce its emissions, a move that Sarasin & Partners believes puts long-term shareholder capital at risk.
Equinor's expansion strategy is evident in its ongoing development projects like Johan Castberg and Johan Sverdrup Phase 3. These projects involve significant investment, new discoveries, and increased recovery rates, indicating a strategic focus on growing hydrocarbon output [1][2][4].
However, the company also emphasises carbon efficiency in its oil and gas projects, claiming that the Johan Sverdrup field is one of the world’s most carbon-efficient oil and gas fields [4]. This focus on reducing emissions intensity in hydrocarbon production suggests a balancing act between increased production and efforts to improve carbon efficiency.
The divestment by Sarasin & Partners is not the only pressure Equinor is facing. Investors Sampension and Folksam, along with the ACCR, have filed a resolution at the AGM challenging Equinor's planned expansion of oil and gas exploration and production. The resolution calls on Equinor's board to explain how it reconciles the company's planned increase in fossil fuel output with the expectations of its majority shareholder, which has committed to operating Equinor in line with the goals of the Paris Agreement.
Jacob Ehlerth Jørgensen, head of ESG at Sampension, has stated that the increase in Equinor's fossil fuel ambitions is problematic. As the controlling shareholder and a signatory to the Paris Agreement, the Norwegian state's position gives investors a potential lever of influence over Equinor. The Norwegian state's position also provides a way to shape broader public policy and market direction.
Natasha Landell-Mills, head of stewardship at Sarasin & Partners, has also expressed concern over Equinor's strategy, stating that it is harmful for sustainable economic growth. The investors have raised concerns over Equinor's strategy and its alignment with the Paris climate goals.
As the AGM approaches, it remains to be seen how Equinor will respond to these challenges and whether it will adjust its energy transition plan to align more closely with the expectations of its investors and the Paris Agreement.
References: [1] Equinor. (2023). Johan Castberg. Retrieved from https://www.equinor.com/en/our-company/our-projects/johan-castberg.html [2] Equinor. (2023). Johan Sverdrup. Retrieved from https://www.equinor.com/en/our-company/our-projects/johan-sverdrup.html [4] Equinor. (2023). Johan Sverdrup Phase 3. Retrieved from https://www.equinor.com/en/our-company/our-projects/johan-sverdrup-phase-3.html
- Sarasin & Partners' decision to divest from Equinor stems from Equinor's refusal to reduce emissions, a move that the firm believes undermines long-term shareholder capital and is detrimental to environmental-science-based investments.
- The increase in Equinor's fossil fuel ambitions, as indicated by its ongoing development projects like Johan Castberg and Johan Sverdrup Phase 3, has raised concerns from investors like Sampension, Folksam, and Sarasin & Partners, who question its alignment with the goals of the Paris Agreement and the finance sector's commitment to sustainable economic growth.
- As the AGM approaches, Equinor faces pressure to adjust its energy transition plan to better reflect investor expectations and the Paris climate goals, especially in light of Sarasin & Partners' divestment and the resolution filed by Sampension, Folksam, and the ACCR challenging Equinor's planned expansion of oil and gas exploration and production.
){kind=link}