As a responsible investor, NN Investment Partners (NN IP) recognises its role as an active shareholder to engage with companies and exercising its voting rights to stimulate sustainable behaviour for its investee companies. Exercising voting rights is one of the most effective ways of doing this. In the 2021 proxy season, which has been unprecedented in terms of the prevalence of ‘virtual AGMs’, NN IP cast 27,714 votes at AGMs globally, including many in favour of environmental and social shareholder proposals. 4,232 of NN IP’s total votes were against boards’ proposals.
NN IP voted 100% in favour of shareholder proposals by Climate Action 100+, the investor-led initiative (86% against management); 80% in favour of climate related shareholder proposals (75% against management); 89% for human and labour rights related shareholder proposals (89% against management); and 100% of biodiversity-related shareholder proposals (100% against management).
NN IP notes that there was unprecedented support for shareholder proposals at big oil companies promoting the energy transition. Resolutions seeking emission reduction targets that are aligned with the Paris Agreement won 80% of votes at Phillips 66; 61% at Chevron; 59% at ConocoPhillips and 30% at Shell, for example.
Say On Climate also took centre stage during the proxy season, providing shareholders with advisory votes on companies’ climate action plans and strengthening accountability on climate, while in response to the impact of recent events such as the global pandemic and the Black Lives Matter movement, shareholders have largely supported proposals related to diversity in the workplace, social equality and equitable access to medicine, and racial justice.
Faryda Lindeman, Senior Responsible Investment Specialist, NN Investment Partners, commented: “As the COVID 19 pandemic continued to impact our lives during 2021, companies have started to implement a so-called hybrid AGM, where the meeting takes place virtually while ensuring ways to facilitate participation and dynamic discussion. This avoids the costs of the venue and shareholder travelling to attend, which reduces the environmental impact. It also makes it easier to attend more meetings and it allows for more flexibility. At the same time, the greatest challenges from our perspective are the lack of participation and ensuring that shareholders can vote live at the meeting. If these issues can be tackled and a way can be found to facilitate more dynamic discussions and interaction, the virtual AGM may have a future.
We believe that ongoing engagement on ESG issues with companies does not stand in the way of ambitious voting behaviour. Rather, we see voting as an additional mechanism to voice our concerns and expectations and further build on our engagement efforts. This voting season has again proved that we can exercise our influence as shareholders in an effective manner.”
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