World’s biggest investment fund takes on Exxon and Chevron over the climate crisis

By Anna Cooban, CNN

London (CNN) — The world’s biggest investor in the stock market wants ExxonMobil and Chevron to do more to tackle the climate crisis.

Norway’s sovereign wealth fund, which holds $1.4 trillion in total assets, announced Friday that it would back calls for the US oil companies to set more aggressive emission reduction targets.

It said it would support motions proposed by climate activist group Follow This at the companies’ annual shareholder meetings next Wednesday. ExxonMobil and Chevron (CVX) have urged shareholders to reject them.

Follow This has called on the companies, along with European oil majors BP (BP), Shell (RDSA) and TotalEnergies (TOT), to set more ambitious targets for cutting their “scope 3” emissions by the end of the decade. Those emissions include the greenhouse gases emitted when their products, such as gasoline, jet fuel and natural gas, are used by customers.

The group says the revised targets would better align the companies with the Paris climate agreement, which aims to limit global warming to 1.5 degrees Celsius.

Mark van Baal, the founder of Follow This, told CNN that the Norwegian fund had a “huge responsibility,” adding that it was surprising it hadn’t taken similar action against European energy firms at their shareholder meetings.

“Basically, 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,” he said.

The fund did not vote with activists against BP and Shell at their most recent annual shareholder meetings, held last month and last week respectively.

Explaining that decision, a spokesperson told CNN Friday that BP and Shell have outlined how their “scope 3” goals align with the Paris agreement.

“While the targets of these three companies differ, they all demonstrate sector leading ambitions,” the spokesperson added.

The Norwegian fund also did not participate in a shareholder rebellion at TotalEnergies’ annual meeting in Paris on Friday, which saw 30% vote in favor of a climate resolution put forward by Follow This. The group said the vote matched a revolt it led at Shell’s shareholder meeting in 2021.

Target setting

ExxonMobil, which has not set “scope 3” targets, said in a letter to shareholders last month that such targets would encourage oil and gas companies to divest their assets, reducing the supply of products “that society needs.”

“Make no mistake, we are committed to reducing greenhouse gas emissions,” the company said.

Chevron aims to reduce its carbon emissions by 5% over the next five years from a 2016 baseline, a target that covers “scope 3” emissions, but has urged shareholders to reject activist proposals.

The proposal would “require shrinking Chevron’s business,” the company said in a letter to shareholders last month.

In an statement to CNN, Chevron said that its “approach to scope 3 emissions enables it to maintain or grow its oil and gas business in response to market demand,” while “still addressing its intent to reduce emission intensity.”

ExxonMobil did not immediately respond to CNN’s request for comment on the voting intentions of Norway’s wealth fund, which is financed by the country’s vast oil and gas revenues. It owns shares in more than 9,200 companies across 63 countries, with total equity holdings of $790 billion.

It holds a 0.86% stake in Chevron and a 1.13% stake in ExxonMobil, according to the latest fund data.

In its statement Friday, the fund also said it was calling for Chevron CEO Mike Wirth and ExxonMobil CEO Darren Woods to resign as chairmen of the companies’ boards because it believed the top roles should be performed by two different people.

“The board should exercise objective judgment on corporate affairs and be able to make decisions independently of management,” the fund said on its website.

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