Proxy Preview is proud to celebrate its 20th anniversary of informing investors about environmental, social and sustainable governance shareholder resolutions. When Michael Passoff founded Proxy Preview in 2005, only a handful of corporations were publishing sustainability reports; climate change and ESG had yet to enter the public lexicon; political spending resolutions were in their infancy; and HIV/AIDS was among the top social issues. It was a record-setting year with about 250 proposals that had average support in the teens. No proposal had yet received a majority vote.
Two decades later, shareholder advocates continue to capture the zeitgeist with more than 500 resolutions filed in 2024. Today, nearly every major corporation has a sustainability officer and a multitude of reports that confirm the positive financial impact of assessing and addressing environmental, social and governance (ESG) material risk. The top shareholder concerns raised over the last 20 years – climate change, political spending, and workforce diversity are now urgent global issues impacting every company and every portfolio.
Shareholders have led the way in educating corporate boards and the investment community about the risks and opportunities of critical environmental and social issues, leading to a philosophical market shift. A recent IBM survey of 5,000 C-suite executives across 22 countries and 22 industries reported that they see value in sustainability: 76 percent say that sustainability is central to their business strategy, 75 percent that it drives better business results, and 72 percent that it can be a revenue enabler. Yet, despite these views, only 31 percent of organizations report they are incorporating sustainability into operational improvements. The shareholder resolutions in this report represent the opportunity gap that links sustainability ambition to action and drives profit maximization and risk reduction for all stakeholders.
The consistent and diligent work of the shareholder advocacy community has been a major part of the transformation from an extractive economy to an emerging regenerative economy based on justice and sustainability. However, there are regressive thinkers that have targeted the unique and vital role of shareholder advocates and the fundamental rights of investors.
The “anti-ESG” crusade is a well-funded and centrally orchestrated attempt to maintain the status-quo against prevailing market forces. This includes three lawsuits aimed at the SEC’s role to protect investors and require appropriate risk disclosure. The House Judiciary Committee has opened anti-trust investigations of 14 banks, proxy advisors, asset managers and non-profits (including As You Sow); essentially investigating the entire global economy. Last spring, 21 GOP state Attorneys General sent a letter warning major asset managers to vote against ESG initiatives with veiled threats. More than 145 anti-ESG bills are being considered in 27 states. Seven states that have passed laws boycotting select banks and asset managers are now struggling to explain why their citizens will pay billions of dollars more in bond interest.
Despite this, shareholder advocacy and sustainable investing is resilient and growing as companies and investors continue to assess and address ESG risk as part of fundamental business practices and to fulfil their fiduciary duty. As the world changes and material risks shift, shareholders are helping the companies they own to optimize supply chains, employee benefits and corporate culture. The changing climate has increased costs for raw commodities with cacao, olive oil, sugar, cotton and other crops in shorter supply after ruinous heat waves, droughts and flooding created “Climate Inflation.” Renewable energy is now less expensive than burning fossil fuels; the internal combustion engine is on its way to becoming obsolete; and clear evidence shows companies with a diverse workforce outperform on eight key financial metrics.
New shareholder resolutions this year invoke the rights of Nature and defend intact ecosystems, alongside innovative ideas on climate change, emissions targets, plastics reduction, healthy food systems, decent work conditions and racial justice. Polls show support for justice and sustainability from a vast majority of retail investors, retirement plan participants, pensioners, family offices and others who until now have been on the sidelines. Proxy season showcases fresh ideas and allows investors to align their actions with their values to shape capital allocations that will ensure financial outperformance on a livable planet.
The handful of extremists who are trying to ignore the realities of a changed investing landscape are on the wrong side of history. They use the age-old tools of censorship, government overreach, fear, misinformation, and ideological persecution of vulnerable groups to serve a privileged few and maintain the status quo. The capital markets work best when shareholders and corporate executives make their own investment and business decisions based on all available data. A wave of heavy-handed laws making it illegal to assess and address risk points to the fact that they really don’t want investors to see the truth – fossil fuel companies will be the Blockbusters and Kodaks of today if they are unable to implement a transition plan to remain viable. If someone tells you to not look at risk and then makes it illegal – you really want to take a good hard look at risk. That is what shareholder advocates will continue to do.
Andrew Behar
CEO, As You Sow