ESG shareholder proposals fail to gain support (2023)
| Environmental, social, and corporate governance |
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The Financial Times reported on May 6 that shareholder resolutions supporting ESG (like proposals aimed at ending bank financing of fossil fuel projects) are failing to gain support this shareholder meeting season:
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This year, shareholder resolutions at Citi and BofA demanding the banks stop financing new fossil fuel projects won less support than they did in 2022. The shift echoes a broader trend in other types of climate-related votes. Across corporate America, there are signs of scepticism over so-called Say on Climate votes asking shareholders to approve climate transition strategies, says Glass Lewis, a shareholder advisory firm. It says while shareholders of US companies were among the first to propose a Say on Climate vote in 2021, none of these proposals were approved, with support ranging from 7 per cent to 39 per cent. “That scepticism appears to have turned to indifference, as there were no shareholder proposals on this topic at US companies in 2022,” it said in a report in March. “It is likely that the momentum around this issue has essentially ceased for the time being at North American companies.” At this point in the annual meetings season, it is too soon to know whether support for other types of climate shareholder proposals has been sapped this year. But two years after the tiny hedge fund Engine No. 1 shocked the world with a victory to elect directors to the board of ExxonMobil, the early voting results suggest climate advocacy by shareholders is not the force it was in 2021. At the same time, investors have cooled on dedicated funds that invest with environmental, social and governance mandates. In April, Goldman Sachs was warned that one of its ESG equity funds might be delisted because it had not attracted enough investors. And more generally investors have pulled billions from sustainable funds this year. This is partly because of performance. For a decade, US ESG large-cap equity funds were among the best performers in the stock market. But this year, ESG funds globally have underperformed the market as “ESG darlings” in clean energy have suffered amid a flight to safety, AllianceBernstein said in a May 3 report.[1] |
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See also
- Environmental, social, and corporate governance (ESG)
- Economy and Society: Ballotpedia's ESG newsletter
External links
Footnotes
- ↑ Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
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