How do investors persuade a company to use fewer chemicals, set zero emissions goals, or strengthen worker rights at factories in its supply chain? Selling shares of a company is certainly an option, but it may not send the intended message clearly. An alternative approach is to use shareholder resolutions and dialogue to change a company’s practices and behavior. This tactic is known in the investment industry as “engagement”, and over the past year it has become clear that many other shareholders are getting involved in the companies in which they invest. They encourage companies to increase their environmental responsibility, and their persuasive techniques are paying off.
as you sow, the leading national nonprofit in shareholder advocacy, has been very busy over the past year carrying out missions. These contacts have been made with companies in order to respond to shareholders’ concerns on numerous subjects. Their advocacy included letters, emails, video conferences, phone calls and meetings.
In the 2022 proxy year, As You Sow:
- conducted 196 missions
- identified 156 companies
- analyzed 11 program areas
What were the results ?
- A total of 99 of these undertakings were escalated and shareholder resolutions were filed on behalf of 79 shareholders.
- The nonprofit organization has successfully withdrawn 56 resolutions in cases where companies have agreed to take the requested action.
- 32 proposals were voted on, with 10 majority votes and median support of 41.4%.
- A total of $2.18 trillion in share value was voted in favor of As You Sow resolutions.
- Companies challenged 15 SEC resolutions; As You Sow won 14 of these challenges, or the proposal was withdrawn during the SEC’s review period, with only one proposal being omitted.
The 196 commitments covered the following areas:
- climate change (78);
- diversity, equity and inclusion (40);
- racial justice (24);
- ocean plastics, single-use plastics and recyclability (18);
- political expenses (10);
- petrochemicals (6);
- pesticides (5);
- misuse and overuse of antibiotics (4);
- business misalignment with investment (4);
- governance (4); and,
- water consumption (3).
What commitments have the biggest cleantech accountability initiatives shown?
The 2022 Shareholder Impact Review report covers data from any company annual general meeting that took place between 07/01/2021 and 06/30/2022.
This kind of active property covers a wide range of tactics used by investors to influence the companies they own on corporate social responsibility issues. What is implicit in this work is an acknowledgment of the responsibility that accompanies stock ownership. Shareholders must ensure that management is doing what it can to improve its performance both financially and in terms of environmental, social and governance (ESG) measures. Ensuring that ESG is a fundamental driving force of a company is forward-thinking and has direct implications for the communities where they operate and throughout their global supply chains.
In the case of As You Sow, the nonprofit aims to work collaboratively with companies to raise and address shareholder concerns about material risk.
Barring extenuating circumstances, they generally start by sending a letter. This begins a process that involves one or more dialogues with a company to attempt to resolve the issue before the issue escalates by filing a shareholder resolution. Many times the questions are answered during an engagement, and the company agrees with the terms presented. This generally involves the public disclosure of material information.
In other cases, a company will agree to investigate an issue or take other action. If a company is unwilling or unable to respond to the issue, As You Sow may put a resolution to the vote at the company’s annual general meeting. Engagement and dialogues often continue after the proposal is submitted and then again after the Annual General Meeting.
Here are some of the As You Sow shareholder pledges that the cleantech community will want to analyze.
- Automatic Zone: 70.4% in favor of reducing operational and supply chain GHG emissions in line with the Paris Agreement’s 1.5 degree Celsius target.
- Boeing: 91.4% in favor of a Net Zero climate transition plan. (Note: This resolution was supported by the company.)
- Chevron: 38.7% in favor of improving climate-related accounting information and assessing the impacts of the Net Zero scenario by 2050.
- Chubb: 72.2% support reducing GHG emissions from underwriting, insurance and investing activities in line with the 1.5 degree Celsius goal.
- DTE Energy: 28.1% in favor of improving GHG emission reduction targets.
- ExxonMobil: 51.0% in favor of improving climate-related accounting information and assessing the impacts of Net Zero by 2050. 36.5% in favor of reducing petrochemical risks through plastics for use unique.
- Sysco: 92.1% in favor of the Net Zero objective and the reporting of the climate transition plan.
- Tesla: 46.4% in favor of greater disclosure of material data on diversity, equity and inclusion of companies – 86.5% of independent shareholders voted in favor (46.4% of total shareholders voted for).
What is the mission behind As You Sow?
As You Sow was founded in 1992. They harness the power of shareholders to create lasting change by protecting human rights, reducing toxic waste and aligning investments with values. Their mission is to promote corporate environmental and social responsibility through shareholder advocacy, coalition building and innovative legal strategies.
They envision a safe, just and sustainable world in which the protection of the environment and human rights are at the heart of corporate decision-making.
When companies focus on the short term and ignore the broader impact of their policies and actions, they create risks for their customers, their employees, their shareholders and themselves. Businesses are responsible for most of the pressing social and environmental issues facing the world today. As You Sow believes businesses should be a willing part of the solutions, and the nonprofit makes that possible. As shareholder advocates, they directly engage corporate CEOs, senior management and institutional investors to change companies from within.
as you sow raised the voice of shareholders to increase corporate accountability on a wide range of environmental issues such as waste reduction and management, as well as social issues such as racial justice, diversity, equity and justice. inclusion in the workplace. Defending shareholder interests works.
As shareholder advocates, they urge companies to understand this broader risk. They work directly with business leaders to collaboratively develop business policies and practices that reduce risk, improve brand reputation and increase results, while bringing about positive environmental and social change. Ultimately, companies that see the world in years, decades, and generations reduce their risk and improve their success.
As You Sow is changing businesses for good.
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