November 4, 2021 Read More →

U.S. regulators set stage for more climate-related proxy votes

Bloomberg ($):

Corporate executives may soon hear a lot more from investors about climate change and social issues after Wall Street’s top watchdog took steps to make it easier for proposals on these topics to get a vote at annual shareholder meetings. 

The Securities and Exchange Commission issued guidance Wednesday specifying public companies shouldn’t exclude shareholder plans from proxy ballots just because the ideas aren’t related to a firm’s business. They agency also said it plans to be more skeptical when companies ask for permission to withhold certain proposals on the grounds that top managers consider them to be inappropriately intrusive.

The change — which was not subject to a vote by the regulator’s commissioners — is the latest attempt by the agency to make it easier for shareholders to take action on hot-button issues like race and climate change since Chair Gary Gensler took the helm. The Biden administration has made environmental, social and governance matters a priority and Gensler has repeatedly clashed with Republicans over the SEC’s plans to write rules related to climate change and efforts to improve diversity of public companies.  

Earlier this year, the SEC refused to allow Citigroup Inc. to exclude a proposal from getting a vote that called for the bank to perform an audit on racial equity. Exxon Mobil Corp. was also denied when it sought an exemption for a proposal related to its efforts to deal with global warming.

[Benjamin Bain]

More: SEC Paves Way for More Proxy Votes on Climate Change

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