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Norway wealth fund pushes Tesla for union recognition, will keep its stake

Published Dec 08, 2023 07:52AM ET Updated Dec 09, 2023 05:35AM ET
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© Reuters. FILE PHOTO: A general view of a Tesla store in Porsgrunn, Norway, December 24, 2021. Picture taken December 24, 2021. REUTERS/Victoria Klesty/File Photo
 
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By Terje Solsvik

OSLO (Reuters) -U.S. automaker Tesla (NASDAQ:TSLA) Inc should respect fundamental labour rights including collective bargaining, Norway's $1.5 trillion sovereign wealth fund said, while adding it would keep its stake in the company and seek to influence policy over time.

The electric vehicle producer faces a backlash in the Nordic region from unions and some pension funds over its refusal to accept a demand from Swedish mechanics for collective bargaining rights covering wages and other conditions.

Norges Bank Investment Management (NBIM), the world's largest stock market investor and Tesla's 7th biggest shareholder with a 0.88% stake worth $6.8 billion, said on Saturday it had "no plans" to divest its holdings in the company, unlike some other funds.

"We expect companies in which we invest to respect fundamental human rights, including labour rights," NBIM said in a statement to Reuters when asked about Tesla's conflict with its Swedish workers.

"In 2022 we supported a shareholder proposal at Tesla that asked the company to introduce a policy to respect the right to organise," it added.

The 2022 proposal, which NBIM said was supported by 32% of those who voted, called on Tesla to adopt a policy of respecting labour rights such as freedom of association and collective bargaining. The company's board recommended a 'no' vote.

Tesla, which has revolutionised the electric car market, has managed to avoid collective bargaining agreements with its roughly 127,000 workers, and CEO Elon Musk has been vocal about his opposition to unions.

Tesla did not respond to a request for comment.

The company has said its Swedish employees have as good or better terms than those the union is demanding.

PensionDanmark, one of Denmark's largest pension funds, said on Thursday it had divested its $69 million holdings in Tesla, while fund manager Paedagogernes Pension said it would follow suit and divest its $35 million stake.

NBIM said its expectations are built on international standards drawn up by the International Labour Organization (ILO) and global conventions on human rights.

In its expectations documents NBIM says that companies it invests in "should engage with workers and their representatives, such as trade unions" in a transparent manner when developing and implementing policies and practices.

'WATCH LIST'

Denmark's AkademikerPension said on Friday it would hold on to its $18 million stake in Tesla but added that it kept the car maker on a watch list and expected the parties to find a satisfactory solution to the ongoing conflict.

"It seems that it has not dawned on Tesla's management that proper working conditions create more value and fewer risks in companies," AkademikerPension's CEO Jens Munch Holst said.

Sweden's AP1 state pension fund, which held a $187 million stake at the end of June, said keeping a dialogue with Tesla was its preferred course of action over selling its shares.

Another Swedish fund, AP4, which has a $114 million Tesla stake, said the workers dispute did not constitute a basis for exclusion as a shareholding.

The New York State Common Retirement Fund said it has "long been concerned" with Tesla's labour issues.

"We have filed multiple shareholder proposals and written letters seeking improvements to Tesla's labor policies and parties," it said in a statement. "Divestment is not a consideration at this time."

Norway wealth fund pushes Tesla for union recognition, will keep its stake
 

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Comments (6)
Wadim Sei
Wadim Sei Dec 10, 2023 11:04AM ET
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Who did we recruit?))
Den Mor
Den Mor Dec 09, 2023 11:27PM ET
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If Tesla refuses to respect, labour laws, just put 100% tariff on their vehicles and send the money to the workers.
Roger Miller
Roger Miller Dec 09, 2023 9:47AM ET
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Don’t matter to the average person since only the elites will be able to afford EV’s while they make the rest of us use dirty and unsafe mass transit.
Fun Poh
Fun Poh Dec 09, 2023 9:10AM ET
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At least the salmon are smart. In the end money talks haha
Tho Nguyen
Tho Nguyen Dec 08, 2023 10:57AM ET
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Time for a new era for labor union. I haven’t heard of any benifit to investors other than union trike that hurt the company. I think Tesla should pull out of Sweden
Tre Hsi
Tre Hsi Dec 08, 2023 10:57AM ET
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Unions do not exist to benefit investors
Niels Jorgen
Niels Jorgen Dec 08, 2023 10:57AM ET
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Yeah so you havebt heard of this called higher production also? Proper skilled workers do the work of 10
Rollin Campbell
Rollin Campbell Dec 08, 2023 9:16AM ET
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Who fights for the customers getting a fair price?
Niels Jorgen
Niels Jorgen Dec 08, 2023 9:16AM ET
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Do the math… with these conditions the skilled labour does a much higher output, needs less bosses and thus saved money with stable production… reality dosent work accordingly to theory it works accordingly to reality check the facts they are well documented
Rollin Campbell
Rollin Campbell Dec 08, 2023 9:16AM ET
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Choose one: union or stock options
 
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