On Tuesday, November 19, the Shareholder Engagement Project (SEP) and Interfaith Center on Corporate Responsibility (ICCR) co-hosted an informational discussion on shareholder engagement and corporate accountability for mission-driven investors in this current political climate. These were some of the main takeaways:
- For decades, ICCR members and other institutional investors such as pension funds, religious endowments and a small handful of philanthropic foundations have been promoting better corporate behavior and discussing issues such as climate change, worker justice, and health equity.
- In recent years, investors have been increasingly aware of the negative impacts of climate risk, attacks against DEI, and other pressing issues. It’s been important for investors to talk to their asset managers, including the large and influential firms like BlackRock and State Street.
- Groups like the oil and gas sector, who are opposed to these issues being raised, have waged a broader attack on corporate and political accountability.
- Attacks on ESG, DEI, and regulatory structures (sensible guardrails around corporate conduct) are likely to increase in Congress, federal agencies, and states with governments that oppose responsible investing.? These attacks are likely to include attempts to weaken corporate disclosure requirements and insulate the management of public companies from investor input and accountability.
- As with Exxon’s lawsuit last shareholder season, companies may also continue to use tactics to curtail shareholder engagement.
- We are already seeing these anti-ESG attacks result in asset managers decreasing their support for shareholder proposals that address important issues such as climate change, racial equity, and labor rights.?
- As deregulation persists, to promote responsible corporate behavior and protect the value of our investments in these companies, the role of shareholders – like foundations and other aligned investors – will only increase in importance.
- In addition to continuing to file and support shareholder proposals, investors can consider myriad actions like adopting responsible contractor policies and proxy voting guidelines; engaging asset managers on how they vote their proxies; and providing public support for proposals or other initiatives that other investors are leading.
- On a governmental level, people can think about how to develop a clear narrative as to why incorporating ESG-related information into investment decision-making is good fiduciary practice; fight back against anti-ESG agency actions; and engage their state legislatures and Attorneys General to clarify fiduciary duty.?
To learn more about ICCR’s work, please visit their website. If you are a foundation eager to learn more about how you can increase your institution’s impact, email Eric Horvath at [email protected] to learn more about how you can get involved in the Shareholder Engagement Project.
