SquareWell’s “Climate Change” report* covers the gamut of topics relating to management-sponsored say-on-climate (SoC) proposals and climate-related shareholder proposals in relation to the firm’s previous analysis and benchmarking (see “Say-on-Climate”).
SoC proposal data includes the number, geography, GICS sector concentration, and voting results (level of shareholder support) of management-sponsored proposals; the substance and scope of such companies’ climate action plans; company commitments to holding periodic votes and responding to shareholder support or opposition; proxy advisor vote recommendations; positions on SoC articulated by numerous large institutional investors (with links to relevant resources); and the level of support for such proposals by the 25 largest asset managers year-over-year.
Shareholder proposal data reflects 5-year trends (2018 – 2022).
Noteworthy takeaways include:
- Of the 291 climate-related shareholder proposals filed at 153 companies over the 5-year period, nearly 60% were aimed at US companies.
- Financials and Energy sector companies have been the top industry targets in terms of the number of proposals received, at nearly 40% and about 20%, respectively, of all climate-related proposals in 2022, and 28% and 19%, respectively, of all climate-related proposals over the 5-year period.
- More proposals were filed in 2022 than in the prior years (79 proposals compared to 69 in 2021); however, the number of proposals supported by a majority of shareholders declined to 12 proposals in 2022 from 17 in 2021, and the number of proposals withdrawn was the lowest over the 5-year period. Just 14% of proposals (40 proposals) voted from 2018 – 2022 have garnered majority shareholder support (15% in 2022).
- Proposals seeking companies’ adoption and disclosure of GHG reduction targets and reporting on financing activities more than doubled year-over-year, while other climate-related asks declined:
- More than one-third of proposals approved by shareholders from 2018 – 2022 sought companies’ adoption and disclosure of GHG reduction targets or reporting on alignment of business strategy with constraints posed by climate change.
- Average shareholder support declined for most proposal types in 2022 compared to the prior years analyzed:
The report showcases a deep dive on each of the climate-related shareholder proposal types that includes the names of targeted companies, shareholder proponents, proxy advisor recommendations, overall vote results, and the voting determination and associated rationale of select major institutional investors.
*Request the complimentary report through the firm's website here.
Access additional resources on our Climate Risk & Disclosure page.
This post first appeared in the weekly Society Alert!