* Fund says reporting requirements are becoming more

voluntary in some markets

* Officials cite dual-share classes as concern because

founders get stronger voting rights

* Guardrails around founders such as sunset clauses are

important, says fund

By Gwladys Fouche

ARENDAL, Norway, Aug 13 (Reuters) - Norway's $2.3 trillion

sovereign wealth fund is raising concerns about what it sees as

a steady erosion of shareholder rights across major markets,

warning that regulations increasingly favour company founders

and insiders over independent investors.

Investing the Norwegian state's revenues from oil and gas

production, the fund owns on average 1.5% of all listed

companies globally, making it the world's largest single stock

market investor.

It has on several occasions set the pace on issues in the field

of environmental, social and corporate governance (ESG).

Fund officials are concerned about what they say is a general

erosion of the rights of independent shareholders such as the

fund, from the existence of different classes of voting shares

to how they can gather information from companies.

"We are concerned about shareholder rights generally. We are

concerned because we're seeing it's been diminished in many

markets, not just the U.S., but also in the UK, in Europe, in

Hong Kong even," said Carine Smith Ihenacho, the fund's chief

governance and compliance officer.

Among the chief concerns was allowing for dual-share classes,

which typically give more voting power to founders and insiders,

while independent investors can own standard shares with less

voting power.

"We're also seeing that it's changing the reporting

requirements, making it more voluntary, and also in certain

places, restricting access to sue the companies and the boards,"

she said in an interview.

"We have seen it spreading and we're concerned that it may

spread further."

EXCHANGES COMPETE FOR BUSINESS

One of the reasons behind the trend was more competition between

stock exchanges, fund CEO Nicolai Tangen said in the joint

interview.

"There is strong competition to get these new IPOs, and

therefore they permit more deviations from normality than we

have seen before," he said.

One recent IPO was for Elon Musk's SpaceX, which the

fund took part in.

On Tuesday the fund announced for the first time it held a 0.05%

stake in the company, worth $1.22 billion as of June 30, in line

with its weighting in the fund's benchmark index, but modest

when compared with the fund's other tech holdings.

Musk holds over 80% of voting rights and combines the roles of

chair, chief executive officer and chief technology officer,

raising questions about the company's governance and the rights

of independent shareholders such as the fund.

Fund officials declined to answer any questions regarding

SpaceX's governance. Speaking generally, Smith Ihenacho said the

conditions around the voting rights of company founders were

important.

"We also say if you do have different voting rights, maybe

(for) a founder, you need certain guardrails," she said.

"So we are also watching those guardrails around the

different share voting structures."

To counter the trend, the fund was advocating on the issue to

stock exchanges, regulators and companies, Smith Ihenacho said.