Norwegian regulator urged to probe Equinor’s Paris alignment claim
A coalition of investors representing $1.3trn in assets has written to Norway’s Financial Supervisory Authority (FSA), calling on it to review Equinor ASA’s climate disclosures amid concerns over the company’s fossil fuel expansion plans.
The group, which includes Sarasin & Partners, Robeco, Brunel Pension Partnership, West Yorkshire Pension Fund, Railpen, KBI and Rathbones, warned that Equinor’s plans to increase oil and gas production diverge sharply from the goals of the Paris Agreement.
Sarasin & Partners had announced earlier this year that it has sold its £9.5m stake in the firm, warning that it considered it 'capital at risk.'
The investors highlighted that most of Equinor’s largest development projects are expected to operate well beyond 2050. They also noted that the company itself has acknowledged potential write-offs of around $4bn under a transition scenario aligned with limiting warming to 1.5°C.
“We cannot see how it is consistent to argue, on the one hand, that the company supports, or is aligned with, a 1.5°C pathway and at the same time disclose large potential write-downs from this scenario,” the investors wrote in their letter to the regulator.
The signatories urged the FSA to “consider whether Equinor is giving a fair and accurate impression about its current alignment with the Paris Agreement goals, and specifically a 1.5°C temperature pathway. The lack of precision in Equinor’s statements undermines trust in the market and is potentially leading investors – including the Norwegian Government – to take inappropriate voting and investment decisions.”
The Norwegian regulator has the authority to fine organisations that provide misleading information. A finding that Equinor is not Paris aligned could also have significant implications for its eligibility in Paris-aligned investment funds marketed across Europe.
Under new ESMA guidelines designed to tackle greenwashing, funds using labels such as “climate” or “sustainable” must have at least 80% of their assets invested sustainably and comply with Paris alignment criteria.
