Below are key takeaways from ISS’ recently released 2020 U.S. Environmental & Social Shareholder Proposals Proxy Season Review. The full report is available to institutional subscribers by logging into ISS Link then selecting the Governance Exchange and its Report Center tab and to corporate subscribers by logging into Governance Analytics then selecting the Governance Exchange and the Report Center tab.
- Record number of Environmental and Social (E&S)-related shareholder proposals gain majority support: Twenty E&S-related shareholder proposals at U.S. companies received majority support, up from 12 in 2019 and 10 in 2018.
- E&S-related proposals remain in the majority of proposals filed at U.S, companies: For the fourth consecutive year the majority of U.S shareholder proposals filed were E&S-related, with 55 percent of all shareholder proposals this year being either environmental or social- related. However, after omissions and withdrawals, E&S-related proposals made up just 42 percent (186 proposals) of all proposals that went to a vote.
- Rate of proponent withdrawals of E&S-related proposals dips: Decrease of withdrawals may be the result of either companies’ or proponents’ reluctance to negotiate, and proponents’ possible reliance on many large asset managers’ stated commitments to support more E&S proposals.
- Political spending proposals remain at the top spot in terms of filings: Ninety-five proposals were submitted, slightly down from 102 last year. Seven proposals related to political spending received majority support, the most of any E&S-related category.
- Climate change risk/fossil fuel lending at banks becomes a key focus area globally: Proposals filed in the U.S., Canada, Europe, Australia and Japan focus on emissions reductions targets in line with the Paris Agreement goals.
- The Covid-19 pandemic and the focus on racial inequality and injustice intensify investor focus on human capital management and workforce diversity: Three human capital management and two workforce diversity proposals received majority support.
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