In addition to a robust summary of shareholder proposal activity, “Trends and Updates from the 2022 Proxy Season” from Freshfields includes a wealth of benchmarking information on board practices as they relate to ongoing and trending investor focus areas that include board oversight structure (see example below), composition, and refreshment, and board and management diversity, as well as relevant regulatory and other developments, no-action letter statistics, and proxy advisor and major institutional investor policies and positions on board and workforce diversity/DEI, director overboarding, and other key topics.
The firm identifies these among the key proxy season takeaways:
- A record-breaking number of shareholder proposals for the Russell 3000, which was tempered by a significant decline in the number of proposals garnering majority support compared to 2021.
- An increase in conservative, anti-ESG proposals
- A continuing decline in vote support for directors, which is associated with a rise in “director accountability” policies and campaigns and director overboarding concerns
- Reduced auditor ratification support
- Of 49 climate-related proposals voted, 12 garnered majority support. The firm indicates that majority support correlated with proposals that were “narrowly tailored and core to a company’s business.”
- An ongoing focus on diversity, which played out in numerous types of social proposals
- Collaborative stakeholder activities focused on worker rights, pay, and working conditions
The report is replete with colorful graphics and other visual features that promote suitability for inclusion in a management or boardroom presentation on these governance trends and other topics.
Access additional resources on our Proxy & Annual Reporting Season 2022 and Board Practices / Governance Practices pages.
This post first appeared in the weekly Society Alert!