ShareAction highlights 13 resolutions on which to judge asset managers’ commitment to ESG

(Thursday 25 March, London) Responsible investment NGO ShareAction has highlighted the 13 most important ESG resolutions to be voted on at AGMs in the coming months. The list is being provided to a number of large asset owners to help them “hold asset managers to account on the votes that matter.”

Asset managers have long defended their holdings in environmentally or socially controversial companies by claiming to use their influence to shift companies towards more sustainable practices, through shareholder engagement.

But in 2020 those claims were put in doubt when a number of reports showed that many of the world’s largest managers systematically fail to vote for shareholder resolutions on ESG topics – one of the most obvious ways managers can use their influence.

ShareAction’s Voting Matters report found that just 15 out of 102 ESG resolutions received majority support last year, with the two largest fund managers, BlackRock and Vanguard, voting for just 12% and 14% of proposals, respectively.

In response, several asset managers pledged to improve their voting performance this year. In December BlackRock announced a new voting policy that it said would support more shareholder resolutions on climate and social issues.

As a result, all eyes are on this year’s AGM season, with many wondering whether deeds will match words. But which resolutions should investors be judged on? Over 2,000 shareholder proposals were voted on last year and a BlackRock spokesperson said:

“Not all shareholder proposals are created equal, and it would be wrong to equate good governance with voting against management without regard for a proposal’s impact. Blindly supporting proposals is not a responsible approach to stewardship.”

The volume of shareholder proposals presents a challenge for asset owners, many of whom want their managers to support worthwhile proposals, but lack the resources to identify which resolutions should be priorities for engagement.

As such, ShareAction has published a list of the 13 most important resolutions to watch this year, which it says are all high quality, high-impact proposals. The NGO is encouraging asset owners to ask their managers to vote for the resolutions on the list, to publicly pre-declare their voting intention, and to publish a rationale for any deviations in voting outcomes.

Guy Opperman MP, Minister for Pensions and Financial Inclusion, said:

“Shareholder voting works. Resolutions can deliver everything from decarbonisation targets to healthy eating strategies. Pension fund trustees, you have the power – ask your fund manager to support shareholder resolutions, or switch to a fund manager who lets you set your own policy. Let’s make 2021 the year of stewardship, and push for positive change.”

The list of resolutions to watch is as follows:

CompanyTopicProponent
HSBCClimateHSBC
TescoHealthShareAction
BungeBiodiversityGreen Century Capital Management
General MotorsClimateNew York City Office Comptroller
BarclaysClimateMarket Forces
AmazonGood WorkOxfam America
AmazonBiodiversityAs You Sow
WalmartGood WorkUnited for Respect
Wendy’s InternationalHuman rightsFranciscan Sisters of Allegany
KrogerHuman rightsOxfam America
Walt DisneyGood WorkDomini Impact Investments
PepsicoHealthShareholder commons
CitigroupRacial equalityCtW Investment Group

 

Notes to editors

For all enquiries and interview requests, please contact:

Cleodie Rickard, Digital Communications Officer, ShareAction
cleodie.rickard@shareaction.org

About ShareAction

ShareAction is a research and campaigning organisation pushing the global investment system to take responsibility for its impacts on people and planet, and to use its power to create a green, fair, and healthy society.

We want a future where all finance powers social progress. For 15 years ShareAction has driven responsibility into the heart of mainstream investment through research, campaigning, policy advocacy and public mobilisation. Using our tools and expertise, we influence major investors and the companies they invest in to improve labour standards, tackle the climate crisis and address inequality and public health issues.