U.S. automaker Tesla (NASDAQ:TSLA) Inc has been urged by Norway’s $1.5 trillion sovereign wealth fund, the world’s largest stock market investor, to respect fundamental labor rights, including collective bargaining rights for unions. The statement comes amid backlash in the Nordic region over Tesla’s refusal to acknowledge demands from Swedish mechanics for collective bargaining rights regarding wages and working conditions.

Norges Bank Investment Management (NBIM), which operates the Norwegian fund and is Tesla’s 7th largest shareholder with a 0.88% stake worth around $6.8 billion, emphasized the expectation that companies in which it invests should uphold fundamental human rights, including labor rights. NBIM revealed that in 2022, it supported a shareholder proposal at Tesla advocating for the adoption of a policy respecting the right to organize. The proposal, backed by 32% of voters, urged Tesla to recognize labor rights such as freedom of association and collective bargaining, despite the company’s board recommending a ‘no’ vote.

Tesla, led by CEO Elon Musk, has resisted entering into collective bargaining agreements with its approximately 127,000 workers, and Musk has been vocal in opposing unions. The company asserts that its Swedish employees already enjoy favorable terms compared to those demanded by the union. The conflict has drawn attention from investors and pension funds in the Nordic region, with PensionDanmark divesting its $69 million holdings in Tesla, and Paedagogernes Pension planning to follow suit with its $35 million stake. NBIM did not comment on whether its investment in Tesla would be affected by the automaker’s stance on organized labor. The fund’s separate ethics council, which can recommend divestment from companies not meeting expectations, also declined to comment, citing expectations based on international standards set by the International Labour Organization (ILO) and global conventions on human rights. NBIM expects the companies it invests in to engage transparently with workers and their representatives, such as trade unions, when developing and implementing policies and practices.