The 2024 proxy season will likely see a rising number of shareholder proposals submitted to companies, a high percentage of proposals going to a vote at annual shareholder meetings, and weakening support for many of those proposals, according to a new report by The Conference Board.
At the same time, major companies and institutional investors are looking to find common ground on shareholder proposals that offer unfamiliar, and sometimes conflicting, approaches to ESG topics.
“There may be a silver lining to the 2024 proxy season, as companies and institutional investors alike navigate ardent pro- and anti-ESG pressures,” said Merel Spierings, author of the report and Senior Researcher at The Conference Board. “If investors and companies can tune out the noise, this proxy season could spark a new era of constructive dialogue that can generate long-term value.”
The Conference Board produced the report with disclosure data from ESGAUGE. It was developed in collaboration with Russell Reynolds Associates and the Rutgers Center for Corporate Law and Governance.
The findings come from shareholder proposals at Russell 3000 companies for (full years) 2022 and 2023, and Chatham House Rule sessions with executives from the investor community representing over 15 trillion dollars in assets under management, as well as with chief legal officers and governance executives.
Additional findings and insights include:
Shareholder Proposals Overall
Data from 2023: 913 shareholder proposals were filed and 71% were voted on, receiving 23% average support. In 2022, 811 proposals were filed and 67% were voted on, receiving 31% average support.
Forecast for the 2024 proxy season
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Support levels are declining: As of March 8, shareholder proposals in the Russell 3000 have garnered 16% average support thus far in 2024, compared to 21% during the same timeframe last year.
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New topics and variations of existing proposals are emerging: Rather than being discouraged after two…
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