In a tumultuous year in which a global pandemic, a racial justice movement, and a contentious presidential election have gripped the United States, corporate shareholders are engaged in environmental, social and governance issues as never before, according to a new report by Intelligize, the industry-leading provider of corporate compliance management solutions.
This ESG-focused playbook from Intelligize offers a guide to proxy-season shareholder proposals on diversity, human capital and political spending. The resource looks into a number of socially focused proposals that shareholders of companies such as McDonald’s, Starbucks and Activision Blizzard approved this year and outlines key issues for companies to watch in the upcoming proxy season.
Key takeaways:
- Diversity: It is no longer a valid position for companies to dispute the benefits of board and workforce diversity. Those benefits are well established and backed by studies that proponents will eagerly cite. Institutional investors and proxy advisors are recommending votes against directors at companies that fail to live up to their promises on diversity and inclusion.
- Human Capital: Though relatively new as a shareholder focus, human capital has already become a topic of intense interest to investors, companies and the Securities and Exchange Commission, which has begun to require human capital disclosure under Regulation S-K. Additional disclosures related to executive compensation and other areas may be on the horizon in the new presidential administration.
- Political Spending: When companies fare poorly on political transparency measures, shareholders can be expected to favor proposals requiring more disclosure. Companies should improve their policies and engage with shareholders before automatically resisting such a proposal addressing political spending.
