Equinor Urges Shareholders to Reject Activist's Emissions Targets Proposal


Equinor urged its shareholders on Monday to reject a proposal by an activist group to set intermediate targets for reducing emissions from the use of its energy products.

The majority state-owned company has pledged to boost investment in renewables and has set a long-term goal to cut greenhouse gas emissions to net zero by 2050, including from the use of its products by customers, known as Scope 3 emissions.

"The board of directors is of the opinion that the company's climate strategy is supporting a sustainable and balanced transition to a low carbon society. Consequently, the board of directors recommends the general meeting to vote against this proposal," Equinor said.

Dutch activist group Follow This has tabled a resolution for Equinor's annual general meeting in May calling on shareholders to vote in favour of setting short, medium and long-term targets for emissions cuts consistent with the Paris climate agreement.

While the resolution includes all emissions, including those from Equinor's own operations, the company has already set intermediate targets for Scope 1 and 2 emissions and Follow This mainly wants new, intermediate targets for Scope 3.

"The elephant in the room is Scope 3 emissions which account for about 80% of total oil and gas emissions," said Mark van Baal, a founder of the group. "Ignoring those is like a tobacco company saying its workers will quit smoking, but it will continue selling cigarettes."

The world's biggest oil and gas companies have set varying targets to reduce greenhouse gas emissions. Europe's oil majors have included Scope 3 emissions in their goals though the big U.S. oil companies have excluded them.

The vote on the Follow This resolution is due on May 11. The Norwegian government, which holds two-thirds of Equinor's shares, is expected to follow the board's recommendations.

Equinor said it would announce short- and medium-term plans in support of its net-zero ambition at a strategy update on June 15, but has not said whether they will include Scope 3.

"Several of the ambitions are, however, dependent on society and hence outside the control of the company – and should therefore not be translated into firm targets," Equinor added.

The company aims to reduce absolute emissions in Norway by 40% by 2030 and by 70% by 2040, but those goals do not include the company's international business or Scope 3 emissions.

Equinor also said it would propose shareholders hold an advisory vote on its energy transition plan in 2022, updating it every three years.

(Editing by David Clarke)

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