(Bloomberg) -- The recent shareholder meetings of Tesla Inc. and Exxon Mobil Corp marked a step change in how Norway’s sovereign wealth justifies its voting decisions.

The fund has now started going into more depth for how it votes at the general meetings for a handful of companies, including the logic behind why it voted against Elon Musk’s $56 billion Tesla Inc. pay package Thursday.

“It’s important that we, as an investor, come out and explain our thinking and offer more bespoke rationale when merited,” Carine Smith Ihenacho, Chief Governance and Compliance Officer at the fund, said by phone.

Norges Bank Investment Management, as it is officially known, also issued additional information on why it opposed the appointment of Exxon Mobil Corp Director Joseph Hooley after the company sued another investor. A shareholder proposal related to greenhouse gas emission targets at Shell Plc saw the investor aligning with management, explaining that while the company’s strategy has “evolved” under the new CEO, it still “sufficiently retains the core components of a Paris-aligned transition plan.”

The fund - which owns stakes in over 8,800 companies worldwide - has been stepping up efforts to use voting as a tool to influence companies, specifically on issues related to climate change, gender diversity on boards and executive pay. In 2021, it started issuing voting intentions five days ahead of annual general meetings and last year began submitting its own shareholder proposals.

Of the three shareholder proposals submitted in 2024, two were withdrawn, Smith Ihenacho said. The third called on US pipeline operator Kinder Morgan Inc. to develop a target for reducing greenhouse gas emissions was voted on at the company’s May 8 general meeting.

“We see it as a basic shareholder right to come up with well-thought-out shareholder proposals, that are reasonably worded and pose reasonable requests,” the executive said. The process for submitting proposals is resource intensive and the fund likely to “prioritize” issues related to climate going forward, she said.

NBIM owns an average of 1.5% of all the world’s listed companies. By publishing voting intentions in advance, the fund has “moved from developing ownership policies to encouraging their adoption,” according to a December working paper published by the European Corporate Governance Institute. The paper found that NBIM’s pre-disclosures of “against votes” led to a 2.7% increase on average of other shareholders voting the same way.

The fund is in regular dialog with the companies it owns, Smith Ihenacho said, including Tesla, where it owned a 0.98% stake worth $7.72 billion at the end of 2023. NBIM had “good discussions with the company, including with the chair prior to voting.”

“We have for some time said we are concerned with the high level of pay packages and how they have increased relative to inflation,” she said. “We are concerned that these types of pay packages may be examples for others, especially when you get to extreme high levels that will be dilutive for shareholders.”

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