The fight over Elon Musk’s pay package and the vote over whether to move Tesla’s headquarters to Texas have been the main focus of attention ahead of the company’s shareholders meeting on Thursday, but not for investors from Nordic countries.
Tesla’s major shareholders in Sweden, Denmark and Norway are instead looking to the meeting to bring the issue of labor rights at the automaker to the fore.
Behind the campaign is the strike of Tesla’s mechanics in Sweden. Now stretching into its sixth month, the dispute has drawn in unions from across the region that have joined in blockades aimed at bringing the U.S. carmaker to the negotiating table to reach a collective agreement with its Swedish workers.
Several of the biggest shareholders in the Nordic countries are urging others to back a proposal that would require Tesla to respect the right of workers to assemble.
Tesla did not respond to a request for comment. It has remained resistant to unions in Europe, even in countries with strong traditions of organized labor. Mr. Musk has expressed his disdain for organized labor. “I disagree with the idea of unions,” he said at the DealBook Summit in New York last year.
None of Tesla’s factories are unionized, potentially giving the company an advantage over rivals like Ford Motor, General Motors and Volkswagen that must pay union wages. But in the United States, Tesla is a prime target for the United Automobile Workers union, which is in a strong position after winning the largest wage increases in years recently for workers at unionized plants.
The proposal up for vote on Thursday was put forward by Folksam Group, an insurance company from Sweden, along with a Canadian pension fund and equity funds from the United States. Together they are calling on Tesla’s board to adopt a policy that would commit to “noninterference and good faith bargaining in accordance with internationally recognized human rights standards with respect to freedom of association and collective bargaining,” according to a filing with the U.S. Securities and Exchange Commission.
Among those backing the proposal, which is up for vote on Thursday, are KLP, Norway’s biggest pension fund, which holds 900,000 Tesla shares worth some 1.7 billion Norwegian crowns, or $162 million.
“We as a long-term investor expect that companies we invest in will adhere to the highest international standards in its business operations, in particular when they have business operations across the globe where the standards may vary from country to country,” said Kiran Aziz, KLP’s head of responsible investments.
The Norwegian fund was one of several investors from the Nordic countries to send a letter to Tesla’s management last year addressing the issue of labor rights.
Despite the strike and the campaign by those Nordic shareholders, Mr. Musk enjoys a strong following among many of the Sweden’s most tech-savvy drivers. Although a majority of Swedes have expressed support for the strike, many are fans of Mr. Musk. Tesla sold 20,400 cars in Sweden last year, and the Model Y is the country’s best seller.
Tesla mechanics who are members of the IF Metall union walked off their jobs in late October. Dozens remain on strike and the union has been picketing the company’s facilities across Sweden.
The union say Tesla is flouting Sweden’s tradition of collective agreements. About 90 percent of Swedish workers are covered by these agreements, which also apply to nonunion employees and set work conditions across industries.
Tesla has refused to engage in the process of collective bargaining that sets such an agreement, arguing that the company pays its workers competitively and complies with local labor laws.
That has not stopped the union from rallying more than a dozen other labor organizations to support its side through sympathy measures, which are allowed under Swedish law. For several months, workers from other industries have been refusing to provide Tesla with services ranging from unloading of its cars at ports, to trash removal to the delivery of new license plates.
Last month, Sweden’s largest union, Unionen, joined the effort with a walkout by workers who carry out equipment inspections for the company.
Tesla has so far found workarounds and has managed to keep its business going without significant disruptions for customers.
KLP, the Norwegian pension fund, has also said that it would vote against Mr. Musk’s $46.5 billion pay package. Although the vote on pay is unrelated to the labor dispute, the fund said that “the total award value remains excessive” despite Tesla’s significant growth. KLP also voted against the pay package in 2018.
Major shareholders appear divided over whether to support the pay package, which was nullified by a judge at a Delaware court in January. Tesla is now asking shareholders to approve the pay package and Mr. Musk has been lobbying shareholders for support over the social media platform X, which he owns.
In reaction to a post by Mr. Musk urging small investors to be allowed to vote, some Swedish retail brokerage firms broke with tradition in Europe by saying they would allow their customers to cast votes at the annual general meeting on Thursday, after they received requests to do so.
“We always want to do our best to meet our customers’ requests, and decided to make an exception this time and to make it possible for them to vote at this specific Tesla annual general meeting,” said Sofia Svavar, a spokeswoman for Avanza, an online bank based in Stockholm.
Jack Ewing contributed reporting.
via The Novum Times
The Novum Times 