Why Norway's $2T fund voted against Microsoft CEO
What's the story
Norway's $2 trillion Sovereign Wealth Fund has voted against key proposals involving Microsoft CEO Satya Nadella. The fund opposed both his re-election as the chair of the board and his compensation package at Microsoft's annual shareholders' meeting on December 5. The virtual meeting discussed various governance and executive pay matters, reflecting the fund's long-standing position on corporate governance and executive remuneration.
Governance concerns
Opposition to dual roles and high executive pay
The fund has been a staunch opponent of governance structures where a company's CEO also serves as the board chair. It believes that such dual roles can undermine board independence and accountability, a view it applies across its global portfolio. The fund also voted against Nadella's compensation package, echoing its wider concerns over high executive pay in major US companies.
Remuneration policy
Stance on executive remuneration
The fund prefers remuneration structures that align the interests of executives with those of shareholders in the long term. It believes a significant portion of annual pay should be offered as shares, locked in for five to 10 years, irrespective of resignation or retirement. This stance was reiterated while opposing Nadella's pay package and highlights the fund's belief that long-term shareholding requirements foster more responsible decision-making at the top of large corporations.
Investment impact
Fund's significant stake in Microsoft
Managed by Norges Bank Investment Management, Norway's Sovereign Wealth Fund is one of the world's largest sovereign wealth funds. As of June 30, it held a 1.35% stake in Microsoft worth about $50 billion, making it the second-largest equity holding after AI chipmaker NVIDIA. The fund is also Microsoft's eighth-largest shareholder, making its votes especially important even if they don't change the outcome.
Shareholder approval
Microsoft shareholders approve proposals despite fund's opposition
Despite the Norway fund's opposition, Microsoft shareholders approved all company-backed proposals. This included an advisory vote on executive compensation, indicating strong investor confidence in Nadella's leadership. The shareholders approved a record-high $96.5 million pay package for fiscal 2025 for the Microsoft chief executive, largely driven by stock awards linked to Microsoft's strong market performance with shares rising about 23% in 2025 and doubling over three years.