Support for ESG shareholder proposals has been slipping since 2023. Shareholder engagement drew the ire of anti-ESG, who have employed various tactics to suppress ESG advocacy. Shareholder activists have been sued, and advisory firms have faced threats of antitrust enforcement. In 2025, support levels for ESG proposals reached new lows from ISS and Glass Lewis. Responsible Investor reports:
“In its benchmark policy, the US proxy giant supported just 7 percent of shareholder requests at S&P 500 firms during the first half of 2025 and no environmental proposals, the consultant reported. In 2024, ISS backed around half of all environment-focused resolutions.
Glass Lewis also cut support for sustainability-focused resolutions in the first half of 2025, but not as dramatically as its rival – reducing it by 5 percentage points to 21 percent.”
On one hand, this is disheartening. It appears that while other fights in ESG are ongoing, anti-ESG got the outcome they were looking for here. However, there’s another way of looking at this development. Shareholder support has been on the decline for years. Some of that is due to anti-ESG, but some of it is due to the market maturing. Many companies voluntarily adopted ESG reporting and net-zero targets. These voluntary efforts made shareholder pressure less necessary. Activists are still finding ways to press companies on ESG. Those methods have just shifted away from proxy contests. Additionally, the SEC’s new stance on precatory proposals makes ESG engagement largely a moot point. It’s possible we’ll see a revival in ESG activist investing under the next administration, but we aren’t likely to anytime in the near future.
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