Last week the prestigious Financial Times reported that the trend this year for shareholder proposals that will reach company proxy statements and therefore be heard at annual meetings has fallen, due to efforts by the Securities and Exchange Commission under Chairman Paul Atkins to limit activity. From the article:
Shareholder proxy proposals have hit a five-year low as environmental and social resolutions experience a prolonged decline amid the US regulator’s efforts to limit investor activism.
At Russell 3000 companies with annual meeting dates between January 1 and May 15, shareholder proposals fell 17 per cent from the same period last year, according to a report shared exclusively by ISS-Corporate.
The drop was largely driven by a fall in environmental and social proposals amid a political environment that has turned against diversity and climate commitments.
Correspondingly, so also have so-called “anti-ESG” proposals diminished. More from the Financial Times:
Even groups critical of environmental, social and governance initiatives have adjusted their strategies. The National Legal and Policy Center, which previously submitted proposals targeting diversity and environmental commitments, has focused this year on governance proposals calling for independent board chairs at companies including Chevron, McDonald’s, ExxonMobil, PepsiCo and Starbucks.
It’s somewhat true NLPC has “adjusted its strategy,” but we have consistently sponsored independent chair proposals at various companies since our Corporate Integrity Project expanded in late 2021. We always intended this year to present many of those types of proposals — which request for two separate executives to hold the Board Chair and CEO roles — because corporate governance is stronger and more accountable under that arrangement, and poor Chair/CEO judgment and execution of their responsibilities is prevalent at so many companies.
Despite the changes at the SEC under Chairman Atkins, which gave companies a glide-path to easily omit shareholder proposals, only one company has excluded a proposal submitted by NLPC: Merck. Other than companies we have reached settlements with to withdraw our proposals (American Express, Apple, Deere and Company, Goldman Sachs), NLPC will present proposals everywhere else where we submitted them.
See our proposal tracker for all our upcoming annual meeting proposals and documents.
