Did you know that the majority of the shareholder resolutions put forth in 2010 were focused on environmental or social issues? What's more, this year, almost half will have the environment as a focus.
That is according to an analysis put forth in a new Ernst & Young report, "Shareholders press boards on social, environmental risks."
The number of corporate social responsibility (CSR) resolutions that came to vote in 2010 was 191, compared with 150 in 2000. Close to 27 percent of the resolutions related to social and environmental issues received at least 30 percent shareholder support. That compares with a measly 2.6 percent in 2005.
Said Steve Starbuck, Americas Leader for Climate Change and Sustainability Services for Ernst & Young:
"Increased awareness among investors and regulators of the reputational and financial risks associated with CSR and environmental sustainability places more pressure on companies to identify and manage these issues. This trends has truly evolved over the last decade, and it is gaining more traction as reflected in the growing number of proposals voted on and the level of 'for' votes cast this season."
According to the report, the resolutions are likely to focus on any or all of the following.
- Energy policy
- Greenhouse gas and carbon dioxide emissions
- Waste reduction strategy
- Recycling, reuse or refurbishment policies
- Product content
- Public policy and advocacy
- Community investments
- Working conditions
- Human rights
- Socially responsible investing
The report suggests:
"Board members and senior management need to understand requests for information related to environmental subjects. Just as important, they must work actively to mitigate shareholders' concerns about environmental issues. Increasing support on shareholder proposals will put pressure on boards to respondent. Further, failure to respond to a shareholder proposal that receives 50 percent or more of votes cast may result in votes against directors in the following year."
Consider yourself on notice.
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This post was originally published on Smartplanet.com