Topic

For the third consecutive year, E&S resolutions accounted for the majority of the shareholder proposals submitted. In addition to the E&S-related proposals, proponents filed 335 shareholder proposals on governance-related issues and 38 proposals that addressed compensation matters.

November 4, 2019

2019 Proxy Season Review: U.S. Environmental and Social Shareholder Proposals

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As of July 31, 2019, 469 E&S shareholder resolutions had been submitted to U.S. companies in 2019, slightly fewer than the 476 proposals filed by the same time last year. For the third consecutive year, E&S resolutions accounted for the majority of the shareholder proposals submitted. In addition to the E&S-related proposals, proponents filed 335 shareholder proposals on governance-related issues and 38 proposals that addressed compensation matters. The number of E&S proposals that were withdrawn remained high, exceeding the number of proposals on ballot for a second year in a row. 

This year, political spending proposals ranked first in terms of number of proposals filed, with 100 such filings. Shareholder proponents increased their focus on the political contributions and lobbying efforts of companies, as we near the 2020 elections. Strictly climate change-related proposals dropped to second place as fewer proposals were filed directly on the topic of climate change. However, increasingly, many other proposal types, such as those asking for increased sustainability and lobbying disclosure, include a climate change focus. In other proposal types, the number of filed proposals related to labor, human capital management, human rights, and board diversity increased. In addition, proponents filed new proposals on concerns related to “inequitable employment practices,” sexual harassment controversies, immigrant detentions, and the use of facial recognition technologies.

At the time of writing, 11 E&S resolutions have received majority support this year, more than the nine majority-supported proposals as of the same time in 2018, and close to the 12 proposals that received majority support during the full calendar year 2018. All majority-supported proposals so far this year relate to social issues. Four proposals focused on political spending. Four diversity-related proposals also received the support of majrotiy of votes cast – two on board diversity and two on workforce diversity. The remaining proposals receiving majority support were two proposals on managing opioid-related risks and one proposal asking for disclosure on human rights policies for inmates and detainees. Overall, median shareholder support for proposals focusing on environmental and social issues (as a percentage of total votes cast FOR and AGAINST), increased compared to last year, from 25.1 percent in 2018 to 26.8 percent in 2019.

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