Your Survival Guy has been talking about the dangers of ESG to investors for years now, and slowly investors and politicians have been catching on. In Florida, Louisiana, Texas, West Virginia, and more, politicians are fighting back against ESG. But it’s not only elected officials who are tired of ESG; it’s corporate board members too. But the most powerful constituency of all pushing back against ESG are the shareholders themselves. Axios’s Emily Peck explains the number of anti-ESG shareholder proposals is rising rapidly.
Companies don’t want to talk about their environmental, social and governance goals anymore, experts in ESG and communications tell Axios.
Why it matters: Promoting ESG policies was once an easy layup to score good press — and theoretically move toward bettering society — but now it’s a way to court controversy, the ire of politicians, and attention from well-funded anti-ESG groups.
- A dozen financial companies, including BlackRock, Blackstone and KKR, now list anti-ESG efforts as a risk in their annual reports, the Financial Times recently reported.
State of play: Anti-ESG forces are in full swing this proxy season — the time of year when public companies host their annual meetings, and shareholders vote on a slate of investor proposals.
- Investors have filed 68 anti-ESG proposals this year to date — compared to 45 in all of 2022, per data from the Sustainable Investments Institute, a nonprofit.
- About one-third of the anti-ESG proposals this year are focused on diversity — asking companies, including Apple, JPMorgan, Coca-Cola and McDonald’s, to report on the “risks” that their anti-discrimination or racial justice efforts pose to their business.
- Two proposals ask companies to avoid public policy positions unless there’s a business justification. And a handful are asking public companies to report the risksposed by attempting to achieve net zero or decarbonization goals.
What they’re saying: “Companies should be prepared to deal with ESG backlash,” the Conference Board warned in its recent proxy season preview.
Action Line: It should be no surprise that shareholders are pushing back against companies using their money to push a social agenda that has nothing to do with maximizing share value. When you want to talk to a fiduciary who puts your interests first, I’m here.
E.J. Smith - Your Survival Guy
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