How did ESG shareholder proposals fare this proxy season?
Here’s an excerpt from this article from Till Investors:
Well, if you’re looking at wins, according to the helpful tracker covering the FORTUNE 250 at the Manhattan Institute’s proxymonitor.org … not so great.
Over fifty votes on climate risk.
In fact, only one — one! — got more than 40% of votes in favor.
Over forty votes on human rights. Zero passed.
Twenty-plus votes on Human Rights. None passed.
More than fifteen on Golden Parachutes. None passed.
7 on Civil Rights. None passed.
Shareholders went 0-for-18 at Amazon. 0-for-12 at Meta. 0-for-11 at Exxon.
Yes, some proposals get withdrawn before going to a vote, as a company and the proponent come to an agreement. But with a voting record like this, how incentivized are companies going to be to engage with proponents moving forward? Engagement is nice. Wins are better.
So, what happened?
The proposals being put forward make strong ethical and moral arguments for many of their cases. Some detail the risks involved with not fully understanding a company’s Human Rights or Climate Change exposure. But what many proposals struggle to do is win supporters with the investment case for their proposals.
The lesson of 2023 is that the investment case — a focus on fiduciary duty — is where the rubber meets the road for shareholder proposals.