Close This site uses cookies. If you continue to use the site you agree to this. For more details please see our cookies policy.

Search

Type your text, and hit enter to search:

Shareholder resolutions have their place


Letter to Financial Times 

FT letter start Shareholder re

BlackRock’s announcement that it is likely to support proportionately fewer shareholder resolutions on climate change makes good investing sense (“BlackRock to vote against climate resolutions”, Report, May 12).

Such resolutions should be assessed on their individual merits, recognising they can play an important role in promoting sustainability.

Shareholder resolutions are more prevalent than a few years ago. As Lex notes, this is partly because activists and NGOs, with no wider investment responsibilities, have identified resolutions as good campaign tools (Lex, May 12). Mainstream investors have become more attracted to supporting and proposing shareholder resolutions for a variety of reasons. In a fierce market for environmental, social and governance investors, supporting a resolution can help differentiate an asset manager from the competition. It can demonstrate an investor is not being passive about an issue.

More importantly, investors understand that no matter how much they engage with companies, it is a shareholder resolution that gets board attention. The negotiations between companies and investors that follow are usually good-natured and constructive. They often move companies to take more and faster action than originally planned. Engagement alone should achieve this, and does with the most enlightened companies, but often this is not the case. Shareholder resolutions, proposed by shareholders interested in sustainable profits, have their place.

First published in the Financial Times on 16 May 2022.
 

Financial Times, 16 May 2022, 19/05/2022

 
Investors need to be clear what criteria they are applying.
My letter in the Financial Times on ESG, ethics, and activist investing.
My assessment of the finance pledges at COP26 and what really matters.
Investors must not forget about profits, even as they focus on wider criteria.
Unless CEOs and their boards are clear about their own values, and those of the companies they run, they will fall down a rabbit hole of confusion.
Press announcement from the Central Finance Board of the Methodist Church.
My contribution to Aftershock, Policy Network's series on the pandemic. Progressives have much to learn from ethical or 'ESG' investors.