As the 2023 proxy season approaches, clues of what to expect can be found in the 2022 trends. Last year, the number of climate-related proposals filed jumped a record-breaking 60% to 241 and — even more importantly — the number of corporations making commitments to shareholders in exchange for withdrawal of proposals prior to voting surged 62% to 115, according to a Ceres analysis.
The combination of these company commitments, along with 18 climate-related proposals that won a majority of shareholders’ votes, means that shareholders prevailed in more than half of their climate engagements with companies they own last year.
On the other hand, voting support for climate proposals declined last year among most, but not all, of the fifty asset managers that Ceres studied compared with 2021. Some possible short-term headwinds during 2022 included Russia’s invasion of Ukraine, and the subsequent energy shortage, as well as a political backlash in the U.S. against asset managers and other investment and financial institutions who factor climate and other sustainability risks and opportunities into investment decisions and proxy voting. Another factor cited by some asset managers was that shareholder proposals in 2022 included more detailed requests of companies than had previously been typical. However, these factors don’t justify the decline in voting support during the 2022 proxy season — the climate risks and opportunities that confront the economy, individual companies, and investors’ portfolios are only continuing to grow and accelerate.