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Votes on environmental and social issues get less support

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Average support halved since 2022 to 16%, Morningstar ( MORN ) says

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Proxy advisors also cut support, Jasper Street says

By Ross Kerber

July 11 (Reuters) - Support for shareholder resolutions

pressing U.S. companies for environmental and social reforms

fell to 16% on average for the 12 months ended June 30, half the

rate of three years ago, data from Morningstar ( MORN ) shows.

Analysts, activists and investors attributed the trend to

hostility to climate and diversity matters from U.S. President

Donald Trump and other Republicans, coupled with the reforms

many companies have already put in place. Top proxy advisers

also reduced their support.

Most U.S. shareholder meetings have finished for 2025, and

the results show how the pendulum has swung away from

progressive corporate causes, albeit while leaving many recent

changes in place.

ENVIRONMENTAL AND WORKFORCE REPORTING IMPROVES

Large investors seemed reluctant to support resolutions that

might attract questions from customers or political criticism,

said Leslie Samuelrich, president of Green Century, a

climate-focused asset manager.

Its own resolutions calling for reports on greenhouse gas

emissions and biodiversity, for instance, won 13.6% on average

this year, against 21% in 2024.

Samuelrich said big investors "don't want to lose clients,

and they don't want a target on their backs".

Marc Lindsay, managing partner of shareholder advisory firm

Jasper Street, said better company reporting of emissions or

workforce diversity was giving executives ammunition to argue

against the need for further reforms.

"There are simply less disclosure gaps for activists to

attack," Lindsay said.

Donna Anderson, asset manager T Rowe Price's ( TROW ) global

head of corporate governance, said its support for such

resolutions was lower than in 2024, when it backed 8% of

environmental resolutions and 4% of social proposals.

"The sense that shareholders need to support any of these

proposals has waned," Anderson said.

PROXY ADVISERS BACK OFF

Lindsay's firm found top proxy advisers Institutional

Shareholder Services and Glass Lewis each backed environmental

resolutions less often this year, and that ISS backed social

resolutions less often. Both have faced pressure from

Republicans and business groups.

ISS declined to comment.

Glass Lewis said a reason for its lower support may be that

"many U.S. companies now meet baseline environmental

expectations, providing shareholders with visibility into how

related risks are being managed."

Industry tracker Morningstar ( MORN ) found "anti-ESG" resolutions

filed by conservatives to roll back diversity or environmental

efforts won only 2.7% support on average, as in recent years.

Tim Schwarzenberger, portfolio manager for filer Inspire

Investing, blamed the low rate on lack of support from proxy

advisers. But he said companies were often willing to make deals

to have the resolutions withdrawn, a trend pro-ESG groups have

also found.

The deals help companies avoid controversy, Schwarzenberger

said. "They want to avoid any negative PR," he said.