As Americans struggle to find common ground on a growing list of social issues, investors are demanding action from some of the nation’s biggest companies.
A majority of Sturm Ruger shareholders want the gunmaker to investigate the human rights effects of its firearms. McDonald’s and Apple and at least half a dozen other companies have been asked to measure and account for potential racial disparities within the workforce and local communities. Abortion was also on the agenda at several corporate meetings, including those at Lowe’s and Walmart.
A registration number Shareholder proxy matters addressing issues of racial justice, gender equality and gun violence have been on the agenda at annual meetings this year. Although a majority failed – most shareholder campaigns fail – some initiatives received strong support. Average support for the racial audits was around 46% and eight of the resolutions passed, according to Bloomberg Intelligence. BlackRock recently published research that showed that roughly two-thirds of resolutions with 30-50% support lead to companies partially or fully responding to requests.
“This is how businesses are kept under fire,” said Amanda Jackson, economic justice campaign manager for the civil rights group. change color, which pushes companies to conduct third-party racial audits. “The ground swell, the preparatory work, has called on companies to be more responsible.”
And the growing momentum has been increasingly backed by big asset managers such as BlackRock and Vanguard Group, which have been more willing to back restless plans around previously taboo topics. Revelations of sexual harassment sparked by the #MeToo movement and protests against racial injustice sparked by the murder of George Floyd have combined to garner more public attention – and company promises — to fight against social inequalities.
Proxy advisory firms run by Institutional Shareholder Services and Glass Lewis have also been active in advising shareholders to support social issues. Home Depot, Johnson & Johnson and Waste Management were among the companies where requests for independent racial audits resulted. The civil rights initiative was the only shareholder proposal to win support from the majority of votes at McDonald’s annual meeting.
“The ball is now in the board’s court to show they are going to be serious and do a quality audit,” said Dieter Waizenegger, chief executive of SOC Investment Group, which advocates for racial audits. It remains to be seen whether companies will respond with strong reporting that goes beyond “greenwashing”, he said.
Conservative shareholder advocates have hit back with demands for their own spin on the race audit, overlapping growing numbers backlash against companies that make business decisions governed by environmental, social and governance principles. The National Center for Public Policy Research has filed a dozen resolutions with companies, including Bank of America and Walmart, demanding reports that assess whether their initiatives are detrimental to the civil rights of workers other than those “diversified labeled companies.” . The proposals received less than 4% support from investors.
Shareholder demand for a human rights impact assessment at Sturm Ruger, which drew 68.5% support, is further evidence that big investors are more willing to take on controversial topics, Judy said. Byron, a member of the Adrian Dominican Sisters, who advocated for the report as part of the Interfaith Center for Corporate Responsibility. The focus on guns comes as the United States continues to grapple with mass shootings, most recently at an elementary school in Uvalde, Texas, and a grocery store in Buffalo, New State. York.
A similar resolution will confront Smith & Wesson Brands later this fall. And Mastercard shareholders will vote June 21 on whether the company should restrict the use of its credit cards to purchase so-called ghost guns, or kits that can be assembled into working firearms without serial numbers or registration. federal.
Sturm Ruger chief executive Christopher Killloy said June 1 at the company’s annual meeting that institutional shareholders were “blindly” following the advice of ISS and Glass Lewis. The arms maker said it promotes responsible ownership and is not directly the cause of human rights abuses. “I anticipate the board will look into the matter in the near term and decide how best to proceed,” he said.
Shareholder proposals calling on companies to report abortion restrictions were less successful. One filed at Lowe’s got 32% support, while an almost identical application at Walmart only got 13%. The results of a third resolution filed with TJX Cos. are not yet available. All three proposals had support from ISS, but not from Glass Lewis. Companies are also being asked to measure whether their political contributions are being used to weaken abortion rights, said Shelley Alpern of nonprofit Rhia Ventures, which coordinated and drafted the proposals.
“So many companies are dragging their feet on this issue,” she said. “We hope they will hear from employees and other stakeholders and realize that it is in their long-term interest.”