Equinor : Shareholder proposals and board response to Equinor’s AGM 2024

Annual General Meeting

Equinor ASA

Proposals from shareholders and response from the board ofdirectors

SHAREHOLDERS PROPOSALS | ITEMS 8-15

Item 8 for Equinor's annual general meeting 14 May 2024

Proposal from shareholder that Equinor shall eliminate management bonuses, pensions and severance pay for former executives, use clothing containing hemp, ban the use of fiberglass rotor blades in new wind farms, commit to buying into existing hydropower projects, conduct research on other energy sources, stop the electrification of the Norwegian continental shelf, and consider installing rotatable Tesla turbines

Shareholder Roald Skjoldheim has proposed the following resolution: "1. Equinor shall eliminate bonuses for management completely.

1. Equinor shall not pay pensions or severance pay to former executives.
2. Equinor shall only use clothing containing hemp.
3. Equinor shall ban the use of fiberglass rotor blades in all new wind farms. And do not replace old fiberglass rotor blades with new ones.
4. Equinor shall make a greater commitment to buying into existing hydropower projects, aiming to upgrade the plants nationwide.
5. Equinor shall conduct research on other energy sources, such as thorium.
6. Equinor shall stop the electrification of the Norwegian continental shelf.
7. Equinor shall consider installing rotatable Tesla turbines that rotate according to the wind to generate electricity."

The shareholder's supporting statement

Most of us would probably agree that executive pay and executive bonuses have spiralled out of control. In state-owned companies, this should not have occurred at all.

1: Eliminate bonuses completely. 

There is no reason to pay a bonus to a manager, or a management team. They are not the ones getting the job done. It is the boys and girls on the floor that make money for a company. This also has to do with the personal safety of leaders. So far, Norway have been blessed with very few cases of rich individuals being kidnapped for their money, but ref. the Reidar Osen case.

2: Pension and severance pay

Cf. item 1. The profits go to the shareholders. Always. I see no reason to pay any severance pay. Nor that the company should pay for the pensions of former executives.

3: Clothing 

Everyone talks about "making sustainable choices for the future". But very few people know what that means. Equinor should only use clothing containing hemp. 70% hemp clothing. This applies to absolutely all employees, whether they work on rigs or in offices.

The benefits of hemp:

1. About 70% less consumption of water during production  
2. It is easier to recycle clothes made from hemp. They need to be collected, cut up, and added to the production of new hemp clothing
3. Hemp will not stick to the skin like polyester does if you are unlucky and get too close to a fire
4. The longevity of clothing will increase 

The disadvantage of clothing made from hemp: 

1. They are more expensive than clothes that are made from linen, cotton, and polyester. (But once they have outperformed those clothes, the price will decline, due to production upscaling)

Concern for the future of the wind power industry

I see an ever-growing demand for energy. Recently, we passed 8 billion people on this planet. And most of us need electricity or energy. We use electrical energy to heat our homes, we use electrical energy when we cook our food, the refrigerator needs electricity to keep food cool, etc.

Basically, wind power is a good and smart solution. Until the wind farm reaches its design life and things need to be replaced. And recycled. This is where things start to get tricky. All metal is treated separately, the oil is treated separately, and the rotor blades... well the rotor blades... They are garbage. There is currently no effective way of disposing of them. Some attempts have been made. In some places, the rotor blades are used for other things. They are often reused in playgrounds for children, they can be shaped as parking shelters for bicycles, they can end up as "art". In some places, the rotor blades are ground up to a powder, which is subsequently mixed with concrete. In these places, this has almost come to a halt. Either because the quality of the concrete turned out to be so poor that the concrete could not be used, or it was stopped because the amount of powder by far exceeded what could be mixed into the concrete. In any case, another "ingenious" solution has now been found. Simply to bury the waste. Let future generations solve our problems. Meanwhile, Mother Nature decomposes the rotor blades. And it is not difficult to imagine particles from the rotor blades finding their way into water and soil. The medical profession in the future is going to be extremely busy because of the mistakes we make today.

1. Ban the use of fibre glass rotor blades in all new wind farms. And do not replace old fibre glass rotor blades with new ones. There must be other materials that are better to use than fibre glass. Glass, which is 100% infinitely recyclable. Hemp, which can be produced without a too big ecological footprint. There are probably better alternatives than this as well. In the worst case, Norway will be the first nation in the world banning wind power production until the companies operating the wind farms manage to come up with a recyclable solution. Burying waste, as they do in the US and Denmark, is not a sustainable solution.
2. Since Norway is blessed with high mountains and deep valleys, hydropower is something we have used a lot of in this country. Equinor must make a greater commitment to buying into existing hydropower plants, aiming to upgrade the plants nationwide. If hydropower plants had produced power using newer technology, we as a society would have got more electricity. We could almost have stopped looking for other sources of energy. Today, hydropower plants are effectively prevented by the country's authorities from supplying us with clean hydropower due to fees and taxes. Equinor should therefore invest some of its profits in bringing the hydropower plants up to today's standard, enabling them to produce clean power at 100% capacity.
3. Research on other energy sources

Equinor should conduct research on other energy sources, such as thorium. The Americans have done most of the research work here. In the long term, two thorium reactors should be built, each underneath a nuclear reactor. This is because you can burn plutonium (the waste from the nuclear reactor) in a thorium reactor. This would be a very lucrative industry to enter, as all of the nuclear countries on the planet do not have a very good plan for disposing of their nuclear waste. Currently, it is either stored or used in the arms industry.

1. Stop the electrification of the Norwegian continental shelf. This must arguably be one of the least intelligent moves that have been made. Does it matter to the planet whether the gas is burned in the North Sea or in Germany? Measures like this only add to the electricity bills for Norwegian citizens, and reduce Equinor's earnings. Both in the long and short term.  
2. The world's smartest man, Nikola Tesla, made over 200 different inventions. Out of all these, he singled out the Tesla turbine as his favourite. Instead of using fibre glass rotor blades in the wind turbines, it might have been an idea to install rotatable Tesla turbines that rotate according to the wind to generate electricity. It is better to have tried out such solutions than trying to reinvent the wheel.

Item 9 for Equinor's annual general meeting 14 May 2024

Proposal from shareholder that Equinor gradually divest from all international operations

Shareholder Ivar Sætre has proposed the following resolution:

"The general meeting asks the company's administration to gradually divest from all international operations, first within renewable energy, then within petroleum production."

The shareholder's supporting statement

In any commercial company, it should be a prerequisite that the company's owners are aware of the company's strategy, and well acquainted with the risks associated with the business.

Equinor (Statoil) was established to build, control and contribute to ensuring that the petroleum activities on the Norwegian continental shelf were carried out for the benefit of Norwegian interests. This has been a success.

Since the beginning of the 1990s, activities have gradually increased outside Norway's borders, first with participation in international petroleum activities, and in recent years participation in the development and production of so-called renewable energy.

International operations have not been without significant losses, and are associated with considerable risk. Approximately 70 per cent of Equinor is owned by the Norwegian state, and ownership is managed by the Ministry of Trade, Industries and Fisheries on behalf of the Norwegian Parliament. Few persons, or none, in these bodies have in- depth knowledge of the business Equinor operates. Assessments of risk are mainly carried out by persons with little or no ownership interest in the company.

Item 10 for Equinor's annual general meeting 14 May 2024

Proposal from shareholders that the board of directors in Equinor resign and make room for a new board of directors with better sustainability expertise and higher ambitions

Shareholders Gro Nylander and Guttorm Grundt have proposed the following resolution:

"1. The annual general meeting refers to the board's failure to address Equinor's shared responsibility for meeting the Paris Agreement's climate goals and the UN's call to terminate all oil and gas exploration. We expect that the BoD accept the consequences of this.

2. The board is encouraged to resign and make room for a new board of directors with better sustainability expertise and higher ambitions for Equinor to contribute more actively to Norway and the UN achieving their climate goals for the benefit of future generations."

The shareholders' supporting statement

We would like to remind you that when Statoil changed its name to Equinor in 2018, the company's mission was changed to "Turning natural resources into energy for people and progress for society". While the name Equinor gave positive associations to equilibrium, i.e. a balance between fossil and renewable energy, after six years Equinor has continued as a traditional oil and gas company where over 99.5% of energy production still comes from fossil energy sources, and less than 0.5% from renewable sources. Investments in new fossil fuels are still many times higher than in renewable sources, and the company's emissions from combustion increased by 7 million tonnes last year. The strong focus on fossil energy sources, with its negative consequences for the climate, neither drives energy balance, nor progress for society".

We note that Equinor keeps exploring for more oil and gas, including subsequent test drilling, although new discoveries will contribute to increasing greenhouse gas emissions on a scale that is neither compatible with the Paris Agreement's climate goals, nor the UN's call on member states to terminate all exploration and the start-up of new fossil energy projects. We also note with disappointment that the board will also extend the phase of stable oil production by five years from 2030 to 2035.

Equinor's board does not appear to have sufficient expertise to ensure the necessary transition of the business in a sustainable direction. The company also appears to lack real commitment to reducing the company's greenhouse gas emitting production sufficiently. We fear that Equinor is heading towards climate ethical insolvency, with a negative impact on the company's reputation and value, both in the market and for future generations.

We ask for the AGM's support for our proposal that the board should accept the consequences of poor results in reducing the company's greenhouse gas generating operations and increasing the share of renewable energy. We urge the BoD to resign from its positions and make room for a new BoD with better sustainability expertise and higher ambitions to contribute to sharper cuts in greenhouse gas emissions, and contribute to the sustainable development of the company and the future of humanity on the planet.

Gro Nylander Guttorm Grundt

Members of the Grandparents' Climate Action.

Item 11 for Equinor's annual general meeting 14 May 2024

Proposal from shareholder that Equinor's management acquaints themselves with the suffering and death caused by global warming, and let this influence their future strategy, and strengthen and implement its Energy Transition Plan

Shareholder Gro Nylander has proposed the following resolution:

"1. Equinor's management must acquaint themselves with the suffering and death already caused by global warming, and let this influence their future strategy.

2. Equinor must strengthen and implement its Energy Transition Plan, aligning it with advice e.g. from the Paris Agreement, the UN, the IEA, WHO, the government's Climate Plan for 2021-2030, the World Medical Association, and various climate summits."

The shareholder's supporting statement

The climate crisis is a health crisis

Physicians have an ethical obligation to raise the alarm about major health hazards. According to the world's foremost medical journal, The Lancet, and an overwhelming majority of the world's climate scientists, global warming is the single biggest global health threat facing the world. It will undermine the global health progress achieved over the past decades. Physicians have a duty to inform about, warn of, and contribute to the prevention of known threats to life and health. Especially in situations where treatment becomes impossible if prevention fails. If another deadly COVID-like virus again emerged and threatened to spread around the world, a united medical expertise - and justice system - would be mobilized to stop anyone who knowingly contributed to its spread. We are now in such a situation. Without effective preventive measures against climate change, the consequences for life and health will be more serious than anything else that has affected humanity for thousands of years. The Norwegian Institute of Public Health writes that extreme weather leads to an increased incidence of, among other things, pulmonary disease, cardiovascular disease, and infections.

The future

Climate change is already being felt in Norway, for example in the form of floods, landslides, and droughts. New heat records were set many places in 2023, including in Oslo, recording 31.8 °C on 15 June. In Europe, about 70,000 people died due to heatwaves in 2022. In Italy alone 18,000 died, and in Germany over 3,000. In Spain, there was a 20.5 percent excess mortality. Between 2030 and 2050, climate change is expected to cause approx. 250,000 excess deaths per year from undernutrition, malaria, diarrhoea, and heat stress alone. Worst in distant, poor countries. As a rich country with large global greenhouse gas emissions, Norway should be at the forefront of the fight against climate change. Instead, Equinor, with the state as the principal shareholder, continues to contribute to Norway's largest emissions.

Norway as a liable slow mover on climate change

Equinor incurs a major liability that may trigger a claim for compensation. Norway has only cut 4.6 percent of its emissions since 1990. However, in the Climate Change Act the Norwegian parliament has laid down a goal of cutting greenhouse gas emissions by 55 percent by 2030. Denmark, Germany, the UK, Sweden, and Finland have cut their emissions by between 35 and 49 percent since 1990. EU emissions were reduced by 15.5 percent in 2023 in a single year. Most rich countries are now cutting their emissions. Europe is stepping up its renewable energy production. The demand for fossil energy will decrease. Worrying about the company's dividends? The same applies to the increasing risk of lawsuits and compensation claims against Equinor. The Norwegian Supreme Court has ruled that the state must consider global consequences for the climate before approving new oil projects. Because this was not done, the Oslo District Court recently ordered the state to pay NOK 3,260,000 in compensation and legal costs to the suing environmental and climate organizations. A number of climate actions are currently in progress in courts. They are increasingly successful. The European Court of Human Rights ruled in April 2024 that the Swiss government has violated the right to privacy and family life by failing to take adequate action to tackle climate change. The ECHR also has an ongoing consultation on climate, supported by many institutions, including Norwegian ones. Another example is the Urgenda case in the Netherlands, where the court ordered the state to take active action against global climate damage.

Equinor should be in a good position for such preventive action, financially, and based on knowledge and experience. The need for rapid progress in renewable energy should now be obvious. Several US tobacco companies were ordered to pay billions of dollars in damages to claimants because they continued to operate after they became aware of the health risks that tobacco posed.

Equinor is on the right track

Low production emissions represent a step forward, but only account for a small fraction of the greenhouse gas emissions that the company's fossil energy production causes outside Norway. Good green projects and plans are being postponed, while other countries implement their… As shareholders, we are disappointed that Equinor repeatedly is unsuccessful in auctions for renewable energy licences. Most recently in the North Sea when foreign auction participants again won. Equinor's solid financial position means that we can tolerate submitting winning bids.

Good climate measures = good health measures and good economics

According to WHO, the World Health Organization, the economic health benefits of reducing global warming will far outweigh the costs of reaching the Paris Agreement targets. Unfortunately, however, Equinor's principal shareholder, the state, votes without exception as instructed by the board. I would like to remind the state representative-who has previously voted down dozens of shareholder proposals that dealt with climate - that the state, it is the people. This year, the state should be able to support the physicians' proposals, which are in line with the government's own goals. High profits recently are more a result of Europe's energy crisis due to Russia's aggressive war than of good leadership. An increasing number of shareholders today believe that the board should be strengthened with renewable energy expertise. If this does not quickly yield results, the question is whether the board should accept the consequences of its climate-damaging policies and resign? Climate change concerns today tops Norwegians' issue rankings. This concern is shared by many Equinor shareholders and employees. The company will not be able to defend itself by maintaining it did not know. Without a rapid change of direction, the verdict of history on Equinor may be devastating.

Sincerely,

Gro Nylander

Gro Nylander, Equinor shareholder, medical doctor

Specialist in Obstetrics, Gynaecology, Medical Genetics

Member of the Norwegian Physicians' Climate Action

Member of the Norwegian Grandparents' Climate Campaign

Member of Concerned Scientists Norway

Non-fiction author

Commander of the Royal Norwegian Order of St. Olav 

Item 12 for Equinor's annual general meeting 14 May 2024

Proposal from shareholder that Equinor must make arrangements to become a leading renewable energy producer, halt plans for electrification of Melkøya, ask the government to stop announcing new exploration acreage, exit all unprofitable and highly polluting overseas projects, and present a phase-down plan for its oil and gas production

Shareholder Bente Marie Bakke has proposed the following resolution:

"1. Equinor must make arrangements to become a leading renewable energy producer, which was the purpose of the name change from Statoil to Equinor.

1. Equinor must halt plans for electrification of Melkøya and offshore installations. Equinor should instead focus on producing electricity by drilling for and converting high-temperature geothermal energy to electricity. CO2 capture and storage should also be utilised.
2. The Equinor board should ask the government, as the majority owner with 67% of the Equinor shares, to stop announcing new oil and gas exploration acreage and not open new areas in the Barents Sea.
3. Equinor must exit all unprofitable and highly polluting overseas projects.
4. Equinor must present a phase-down plan for its oil and gas production, enabling Norway to fulfil its commitments to the Paris Agreement, and Norway to become net-zero by 2050"

The shareholder's supporting statement

Even as a member of parliament for the Conservative Party in the 1980s and as the environmental policy spokesperson for the party, I was worried about the living conditions of future generations due to the ever-increasing and polluting emissions to soil, air, and water. I unsuccessfully tried to influence the party to become the leading party for preserving nature and stopping environmentally polluting emissions.

In 2002 I left the Conservative Party and became the leader, and in 2015 also a member of the executive committee, of the Green Party of Norway in Vestby. Unfortunately, the party did not, neither locally, nor centrally, gain support for its good climate and environmental policy proposals.

Since 2010, I have several times as a shareholder been to Statoil's and Equinor's annual general meetings with proposals to stop exploring for more oil and gas and instead become a leading producer of renewable energy. After all these years, I have realised that it is not Equinor that is responsible for Norwegian oil policy. This is the government's responsibility.

Unfortunately, rather than complying with the calls of UN Secretary-General António Guterres to halt all exploration for more oil and gas, the government continues to announce new exploration areas, many of them in the vulnerable Barents Sea, where there is also an alarming lack of oil spill preparedness.

In 2023, the government announced 46 new exploration areas and put out another 92 areas for consultation. They are all located far from existing infrastructure. If discoveries are made, the development will be expensive, and possible revenues will not be recorded until in the 2040s. So how can Norway become net-zero by 2050? Nor does the government listen to the Intergovernmental Panel on Climate Change or the International Energy Agency (IEA). They say there is no room for any new oil and gas fields if we are to avoid the worst consequences of the climate crisis.

In 2024, the government has announced 62 new exploration areas in the Barents Sea for application, and awarded 47 new exploration licences for oil and gas. Against this backdrop, it is possible to understand that Equinor as a Norwegian company wants to be an operator in Norwegian areas. Investments in new, renewable energy are impeded by government policies. The oil tax package of more than NOK 100 billion, adopted by Parliament during the pandemics, accelerated exploration activities.

Geothermal energy is among the largest possible energy sources available. With its deep expertise in drilling technology, Equinor has the potential to become a leading producer of new, renewable energy by converting high-temperature geothermal energy into electricity. This could provide a rapid increase from the current 0.5% renewable share in Equinor's energy production.

Let us hope that the government represented by prime minister Jonas Gahr Støre, finance minister Trygve Slagsvold Vedum, energy minister Terje Aasland, minister of climate and the environment Andreas Bjelland Eriksen, and minister of trade and industry Jan Christian Vestre now speed up the work to ensure that Norway achieves its climate goals.

As a grandmother of four grandchildren, I believe that both Equinor and the government must take the increasingly extensive and devastating climate and natural disasters that are happening all over the world seriously. The possibilities of preserving our vitalizing nature and a liveable climate must not be sabotaged by the search for increased profits.

The board and management of Equinor must also acknowledge that it is not only the future of my grandchildren and the world's children that is being destroyed by the production of more oil and gas, but also the future of their own descendants.

Bente Marie Bakke (sign.) 

National board member of Grandparents' Climate Action (BKA) 

Local group leader of Grandparents' Climate Action, Indre Østfold

Former group leader, the Green Party of Norway, Vestby (2015-2019)

Former member of parliament for the Conservative Party (1981-1989) 

Item 13 for Equinor's annual general meeting 14 May 2024

Proposal from shareholder that Equinor shall work towards dismantling the Corporate Assembly, strengthen the Board, change the Articles of Association regarding the nomination committee, and that the renewable energy business become an autonomous entity

Shareholder Even Bakke has proposed the following resolution:

"1. Corporate Assembly: Echoing Hydro's 2022 initiative, I propose that Equinor shall work towards dismantling the Corporate Assembly to democratize board elections by changing Par. 7 in the Articles of Association. This will directly involve shareholders in the selection of board members and governance decisions during the Annual General Meeting (AGM).

1. Board Composition: I suggest strengthening the Board where at least three members have significant international energy sector and change management experience. Further, increase the board member compensation significantly to attract distinguished leaders capable of steering Equinor through the rapidly changing energy landscape.
2. Nomination Committee: I propose that the Articles of Association shall require that the nomination committee shall have at least two members with significant international experience.
3. Renewable Energy Division Independence: I propose that the renewable energy business become an autonomous entity, underscoring the commitment to leading the energy transition and facilitating focused growth and innovation in this critical area."

The shareholder's supporting statement

The following proposals aim to improve Equinor's focus on sounder corporate governance practices and environmental sustainability while aligning with global energy transition trends. It advocates for pivotal reforms that will position Equinor within the renewable energy sector, ensuring long-term shareholder value and environmental stewardship that will support current and future generations in their work to reduce the consequences of climate change.

State Ownership Adjustment

I recommend that the government propose and Stortinget approve a strategic reduction of the Norwegian state's ownership in Equinor to below 50%. This to balance governance and foster active engagement from a broader shareholder base. The Ministry of Trade and Industry (earlier the Energy Ministry), representing the Norwegian state's 67% ownership in Equinor as well as the leadership team, including corporate management and the Board of Directors, have shown complete disregard and dismissiveness toward proposals from Norwegian shareholders. The Ministry of Trade and Industry's very passive approach to managing the company and the coupled with the corporate framework, grants senior management and the Board overwhelming authority, severely limiting shareholder influence and any form of checks and balances. As a result, the AGM plays a marginal role, lacking the ability to elect or question the board members.

Equinor ignore constructive shareholder proposals from Norwegian shareholders

For numerous years, Norwegian shareholders have presented proposals at the AGM regarding Equinor's global oil and gas exploration and production, corruption, environmental safeguards, and transitioning towards renewable energy. Despite their potential benefits, these proposals have been routinely rejected by the Ministry of Trade and Industry and earlier by the Ministry of Energy delegates. Decisions to dismiss these proposals preceded the AGMs, following discussions among Equinor's Board and its corporate executive committee, with the Ministry endorsing the Board's stance uncritically and therefore not accepting any of these proposals. Looking back, it's evident that adopting these shareholder proposals could have significantly reduced financial and reputational losses for both Equinor and Norway. Such cases were presented in my 2023 proposals to the AGM.

Furthermore, these losses resulted in no consequences for the top executives or the Board of Directors. In fact, despite widespread support from the Norwegian public and many legislative representatives, only one proposal out of 50 presented by Norwegian shareholders from 2006 to 2023 has been accepted. Furthermore, during this period, the Ministries did not present a single proposal and displayed a complete lack of initiative and passive ownership.