Looking Back at the 2017 Proxy Season
Two recent reports on the 2017 proxy season highlight the rising tide of successful shareholder resolutions seeking more disclosure on climate change preparedness, among other issues. Climate change led proxy season coverage in both the eight-point list issued by ISS Corporate Solutions (ICS), an independent subsidiary of Institutional Shareholder Services (ISS), and the Proxy Pulse report produced jointly by Broadridge Financial Solutions and PwC’s Governance Insights Center. The ICS report notes that three climate change proposals—at ExxonMobil, Occidental Petroleum Corporation and PPL Corporation—received majority support. According to ICS leader Peter Kimball, “the shareholder awakening on climate change was the most significant story of the 2017 proxy season.” The Proxy Pulse report notes that institutional investors voted 66 percent of their shares in favor of climate change-related proposals.
In addition, the reports highlight proxy access, political activity and shareholder rights as key themes, along with increased support for board diversity and annual say-on-pay frequency votes. 2017 also saw a spike in the number of directors receiving low levels of support from shareholders. According to Mr. Kimball, “the advent of mandatory say-on-pay proposals in 2011 deflected a lot of negative votes away from directors, but this year shareholders shifted their voting focus back to the boardroom.” The Proxy Pulse report notes that, while the number of shareholder proposals that actually went to a vote decreased from 506 in 2016 to 430 this season, shareholder support of proposals across various categories increased, particularly among institutional investors.