Subscribe to Our Blog

Shareholder Sustainability Pressure Spurs Changes in Corporate Efforts

The sustainability advocacy group Ceres released a new report showing positive changes in corporate action on environmental, social, and governance (ESG) and corporate responsibility matters.  These changes have been spurred on by shareholder resolutions and engagement between companies and shareholder advocates.

Long-term investors are speaking up about their concerns about sustainability risks. Many are working to impress on companies the importance of making major efforts to mitigate these risks. These investors believe that addressing ESG issues will be a primary driver for future company performance.

The Ceres report covers 91 investor-reported commitments made by corporations in response to investor resolutions and engagements. The commitments focus on sustainability challenges including GHG emissions reductions, fossil fuel industry risks, sustainable agricultural and deforestation, and other issues such as governance, political involvement, and water management.

Of the commitments investors sought and reported on, 73 percent were fully met and 86 percent were mostly met.  Among the examples of corporate projects is 3M’s commitment to have 25 percent of its electricity needs met through renewable energy by 2025. This will replace 800,000 megawatt hours of energy with wind and solar power. Archer Daniels Midland (ADM) will be the first major supplier to begin implementing a no-deforestation policy for its soy and palm oil production globally. ADM, as one of the top three suppliers of agricultural commodities globally, will make a significant change in environmental impacts with this policy.

The Ceres report shows record-breaking results in shareholder resolutions and corporate sustainability actions. While not all investor efforts have been successful, there is significant potential for shareholder activism to be an important driver for corporate sustainability.

Get the full report here.