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- Support for environmental and social resolutions declined in 2024, continuing a downward trend.
- Governance proposals saw a rebound in support, contrasting with the ESG pullback.
- A core group of sustainability-focused asset managers continues to back key ESG resolutions.
The 2024 proxy season highlighted a notable shift in shareholder support for environmental, social, and governance (ESG) resolutions. While governance proposals experienced a resurgence, backing for environmental and social resolutions continued to wane. This divergence underscores the evolving priorities among institutional investors.
Morningstar’s analysis of key resolutions—defined as environmental and social proposals with at least 40% support, excluding insider votes—reveals critical trends beneath the surface numbers. The pullback in support for ESG proposals by some of the largest US asset managers has continued this year, further shrinking the population of key resolutions, Morningstar reported.
Despite the overall decline, a closer examination of “near-miss” proposals—those just below the 40% support threshold—shows that a committed group of sustainability-conscious asset managers remains steadfast in their backing. These managers are supporting resolutions that are increasingly overlooked by the largest firms.
Related Article: Morningstar Strengthens ESG Leadership with Michelle Cameron Appointment
The patterns in proxy voting are crucial for shareholders seeking alignment with managers who reflect their values Morningstar emphasized. The final confirmation of these trends will come with the release of manager voting records in the coming weeks.