MEDIA CONTACT: Sophia Wilson, swilson@asyousow.org, (341) 600-1832
BERKELEY, CA—JULY 27, 2023—The Proxy Preview team today reviewed results from the 2023 proxy season during its 2023 Proxy Preview REVIEW webinar. The season saw 335 votes on shareholder proposals asking for disclosure and action on environmental, social, and related corporate governance (ESG) issues at U.S. companies. More than two dozen proposals are still pending.
Results this year are mixed, with continued support for proposals on lobbying oversight and disclosure. There were solid votes on decent work (fair pay and worker treatment), and a strong showing of about 30% for new proposals about domestic labor rights. The overall average vote fell, and majority votes were down sharply — eight compared to about three dozen in the two previous years. But engagement resulting in withdrawn proposals continued.
The number of climate change proposals rose steeply and largely focused on greenhouse gas emissions while also including new and more specific disclosure ideas, with varying results. Investors shrugged off a flood of 52 anti-ESG proposals and gave them just 2.4% average support, half what’s needed for resubmission.
Proponents withdrew 223 proposals, mostly in exchange for company action, compared to 275 last year. The U.S. Securities and Exchange Commission (SEC) omitted a scant 44 proposals (compared to 39 last year) following “no-action” challenges.
The results were affected by:
On climate change, some more specific proposals asked for net-zero climate targets in three time frames rather than seeking broad disclosure that many companies already provide. Support for push-the-envelope ideas has always taken time to attract support. Investors this year also are still awaiting regulatory certainty from the upcoming SEC mandatory climate disclosure rule.
On diversity, companies now routinely disclose basic data, and this year many companies agreed to provide more information about how they manage this key human capital issue, producing withdrawals.
Large mutual funds and proxy advisors have pulled back support for proposals as they face political attacks from anti-ESG players, including Republican attorneys general and anti-ESG state legislators. This seems to have prompted more cautious behavior from big investors and proxy advisors.
“Last year’s strong support for equal racial and gender pay, workplace bias reporting, and worker safety continued unchanged,” said Michael Passoff, CEO of Proxy Impact and co-author of Proxy Preview.
“The volume of social and environmental proposals continued to expand this year, and while overall support fell, consideration of environmental and social issues is baked into established investment analysis today,” said Heidi Welsh, executive director of the Sustainable Investments Institute (Si2) and co-author of Proxy Preview.
“Lobbying—and climate-related political influence—remains a clear investor concern, while fair pay and workplace safety also have significant support. On climate change, proponents looked beyond the energy and utility sectors for action, and investors seem less certain about this. But there were plenty of agreements to report on GHG emissions reporting, target adoption, and climate transition planning.
“Shareholder advocacy, at its core, is about expressing new ideas and helping companies identify material risk and opportunities for all stakeholders,” said Andrew Behar, CEO of As You Sow®. “This year, As You Sow’s expert teams engaged 209 companies, sharing well-researched data and analysis. Of the proposals that went to a vote, 96% exceeded the SEC’s resubmission threshold. This year has really been about helping companies shift toward justice and sustainability for the benefit of all stakeholders, regardless of the noise and political theater that the anti-business crusade has been whipping up.”
For more key findings from the 2023 season, please visit the Proxy Preview website.
# # #
Proxy Preview 2023 has commentary from more than 30 experts, describing this year’s top ESG issues and the risks, and opportunities facing investors and corporate executives.
As You Sow is a nonprofit organization that promotes environmental and social corporate responsibility through shareholder advocacy, coalition building, and innovative legal strategies. See our resolutions here.
Proxy Impact provides shareholder engagement and proxy voting services that promote sustainable and responsible business practices.
The Sustainable Investments Institute (Si2) provides impartial analysis for institutional investors to make informed, independent choices on social and environmental shareholder proposals.