BP PLC (LSE:BP.), Glencore PLC (LSE:GLEN), McDonald's, Amazon and Google owner Alphabet are facing important shareholder resolutions on environmental, social and governance (ESG) issues as the annual general meeting season ramps up in the coming weeks.
Research showed that in last year's AGM season, the world’s largest investors continued to drag their heels when it comes to showing support for ESG resolutions.
On average the four biggest asset managers, BlackRock, Vanguard, Fidelity Investments and State Street, supported just one-fifth of ESG resolutions on these themes, according to research by ShareAction, a responsible investment charity.
Due to this lack of action, 49 extra resolutions narrowly missed out on receiving the level of majority support that would have been possible if the largest asset managers had voted in favour of them.
While voting performance has shown a large improvement from European asset managers, it was "stagnant" in the US and the UK compared to 2021, the research found.
For asset managers and investors focused on ESG, 2023's batch of AGM resolutions is going to be "a litmus test for how serious they are about supporting social and environmental progress," ShareAction said.
"Asset managers have long justified holding environmentally or socially controversial companies with the claim that their influence can shift companies towards more sustainable practices.
"The systemic failure of many of the world’s largest managers to vote for ESG shareholder resolutions, as one of the most straightforward ways they can use their influence, would appear to contradict this."
The charity produces a 'live' list of key AGMs to track any significant new resolutions made public as well as changes in the status of resolutions already listed. ShareAction said it is intended to combat shareholder voting inaction by highlighting important resolutions.
AGMs to watch for ESG investors
12 May – BP PLC (LSE:BP.): Follow This are calling on BP to ensure its scope 3 emissions reduction targets are Paris-aligned to ensure the oil supermajor reaches net zero by 2050 and helps to mitigate systemic climate risks for investors. The company has recently drawn criticism from shareholders and environmentalists for paring back its commitment to cutting oil and gas output by 2030.
See also Shell PLC on 24 May with a resolution on reporting on greenhouse gas (GHG) emissions targets.
25 May – Amazon.com Inc: It is being called on to provide comprehensive disclosure on GHG emissions and report on ethnicity and gender pay gaps, with resolutions by GreenCentury and a group including Arjuna Capital, which has persuaded 28 Fortune 500 companies in recent years to disclose racial and gender pay gap data.
26 May – McDonald's Corp (NYSE:MCD): A coalition of investors is asking the fast food giant to reinstate a commitment made in 2018 to addressing antibiotic overuse in its supply chain on a defined timescale. Given the potential for a worldwide crisis of antibiotic resistance, the resolution urges McDonald’s to update its antibiotics policy for its global beef supply chain.
1 June – Alphabet Inc (NASDAQ:GOOG): This resolution was filed at Google and YouTube’s parent company in response to the increasing sway of the company on how privacy, AI and online content are being managed, and the rise of class-action lawsuits alleging Google has invaded people’s privacy or misused user’s photos and data. It requests that the company reports on how effectively its Audit and Compliance Committee is assessing any consequential risks to public wellbeing from the company’s practices.