This is a busy year for shareholder resolutions according to a report released by the Investor Responsibility Research Center (IRRC) and the Social Investment Forum (SIF), “Towards a Shared Agenda: Emerging Corporate Governance and Social Issue Trends for the 2002 Proxy Season and 2001 Issues Review.”
More than half (428) of the 712 shareholder resolutions filed thus far in 2002 focus on corporate governance issues a la Enron. Corporations seem to be more willing to negotiate and take action on resolutions this year due to heightened investor concern regarding disclosure and accounting. 32 proposals relate to auditing and another 35 relate to the independence of directors on key committees. 15 proposals ask companies to strengthen the link between executive compensation and performance, and/ or measures of corporate social responsibility.
261 resolutions address corporate responsibility; companies’ involvement in climate change is the fastest-growing category (18 resolutions this year, 7 last year). The campaign to persuade companies to improve, monitor, or report on their global labor practices is another high-profile proxy battle, with 45 global labor standards proposals filed. A key area to watch: how will investors and managements respond to the 31 proposals filed by U.S. labor union pension funds asking companies not to employ auditors for non-audit services?
In the 2001 season, 262 resolutions were proposed to 177 companies. 159 of those proposals were voted on – the highest number since 1992, the peak of apartheid resolutions. 45 proposals won at least 10 percent of the shares voted, about 75 percent more than in 1999 and 2000 (when 25 and 27, respectively, achieved double-digit support).
IRRC’s list of social and environmental shareowner resolutions are listed on SocialFunds.com: http://www.socialfunds.com/sa/status.cgi
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