State Street’s annual stewardship report reveals these and other noteworthy statistics for 2023:
Of 940 comprehensive engagements, 68% were with North American companies.
State Street voted in accordance with management recommendations on 92% of shareholder proposals (based on 4,480 proposals) and 83% of management proposals (based on 200,238 proposals) worldwide.
By shareholder proposal category, it voted against management’s recommendations most frequently on corporate governance and compensation-related proposals.
With regard to environmental and social shareholder proposals in North America specifically over the past five years, State Street’s support declined from a peak of nearly 40% in 2021 to about 17% in 2023.
Globally, State Street engaged with more than 160 companies on climate change risks and voted on 206 climate-related shareholder proposals in 2023. Of those shareholder proposals voted, State Street supported 14%, representing a four-year low, which it attributes to, among other things, increasingly overly prescriptive proposals:
Environmental Shareholder Proposals
We voted in favor of 14 percent of environmental shareholder proposals in 2023. As shown in the Figure 24, our support for environmental shareholder proposals decreased in the last two years. The decline in our support is attributed to several factors. There has been an increase in the number of environmental proposals; for example, we voted on 206 environmental proposals in 2023, compared to 183 in 2022. With this increase, the proposal topics, nature of proposals filed, and targeting of proposals have all evolved. In recent years, there has been an evolution of proposals that use increasingly prescriptive language. Proposal language has moved from disclosure-focused to requesting changes to corporate practices or policies. For example, there has been an increase in proposals calling for the phasing out of a product or business line within a defined timeframe, increasing or decreasing investment in certain products, and/or decommissioning assets, which we generally do not support.
State Street conducted nearly 300 racial, ethnic, and gender board and workforce diversity engagements in 2023 and voted against more than 1,200 directors of companies in the Russell 3000 and other enumerated indices that did not have at least 30% representation by women pursuant to its proxy voting and engagement policy (p10), which provides for votes against the Nom/Gov Committee Chair or board chair/lead director in the absence of a Nom/Gov Committee.