Other

Corporate programme

Climate Action 100+ flagged resolution: Equinor (EQNR): Annual General Meeting – Wednesday 11 May 2022

29.04.22

Equinor — Sarasin & Partners to vote AGAINST three management proposals: The Energy Transition Plan vote; Annual accounts; and the remuneration of the Auditors.

Summary of why the resolution is being flagged

Sarasin & Partners LLP will be voting as follows at the 2022 AGM, with the stated rationales:

  • Energy transition plan (Resolution #10) – Against
    • Equinor, has published a detailed Transition Plan setting out how they will deliver their net zero by 2050 ambition. Shareholders have the opportunity at the coming AGM to vote on whether it is good enough.
    • Notwithstanding the positive steps that Equinor’s leadership is proposing to take, Sarasin & Partners are planning to reject this plan. Whilst the publication of a clear plan to achieve Equinor’s stated Net Zero ambition is supported, they feel they cannot support a plan that fails to align with a 1.5C pathway. Put simply, Equinor’s capital expenditure needs to shift more quickly into clean solutions, and also more quickly away from carbon-intensive infrastructure.
  • The annual accounts and dividend (Resolution #6) – Against
    • They propose a vote against the Annual report and financial statements on climate grounds:
      • It is unclear how asset lives, expected production volumes and asset retirement obligations are consistent with Equinor’s stated climate targets. There is a 1.5C sensitivity analysis (suggesting a potential $7bn impairment) but this seems low when compared to their parallel sensitivity for a 30% reduction in commodity prices ($9bn). One of the leads states that they cannot establish whether they have included the impacts for all balance sheet items beyond Property, Plant, and Equipment (PP&E), or whether they considered impacts beyond lower commodity prices and carbon taxes (such as shorter asset lives etc).
  • Auditor remuneration (Resolution #22) – Against
    • They will vote against the remuneration for the auditor on climate grounds. They make no mention of how they considered climate risks for their Key Audit Matters (KAMs) on AROs. Moreover, EY does not comment on whether the financial statement reflect Equinor’s Net Zero ambition, or medium-term targets, which we would expect to have a bearing on their assessment of the veracity of the accounts.

See investor statement from Sarasin & Partners here and supporting assessment from Carbon Tracker here.

Download the full memo below.

Latest Resources

Report

17.05.22

Investor practices programme

Derivatives and Hedge Funds Discussion Paper

Summary

Other

06.05.22

Cross programme

Climate Action 100+ flagged resolution: TotalEnergies SE: Annual General Meeting – Wednesday 25 May 2022

Summary

Other

29.04.22

Corporate programme

Climate Action 100+ flagged resolution: Equinor (EQNR): Annual General Meeting – Wednesday 11 May 2022

Summary

Webinar

29.04.22

Investor practices programme

IIGCC Real Estate Roundtable: Policy Barriers and Opportunities

Summary

Report

29.04.22

Investor practices programme

Q&A: Net Zero Investment Framework and the Sustainable Finance Disclosure Regulation

Summary