Overview

In what promises to be a groundbreaking year, the 2026 proxy season will play out alongside an ambitious SEC regulatory agenda with a focus on supporting innovation, capital formation, market efficiency and investor protection.

The SEC’s near-term priorities include establishing a regulatory framework for crypto assets, expanding investor access to private markets, easing compliance burdens, re-anchoring disclosures in materiality, and reforming securities litigation to curb frivolous lawsuits¹.  The Commission is additionally fast-tracking a rule change to allow public companies to switch from quarterly to semi-annual earnings reporting.

The proxy voting landscape is also being reshaped with the goal of “depoliticizing” shareholder meetings and restoring their focus to core corporate matters.  This will include an SEC proposal this spring to modernize Rule 14a-8 and, per a recent White House executive order (EO), consideration of new rules to regulate proxy advisory firms.

While these initiatives will not directly impact 2026 annual meetings, other trends and developments will inform contemplated regulatory actions and recast the company/shareholder dynamic in the future:

Much ado about omissions: For this year’s proxy season, the SEC made two significant regulatory shifts which will give companies more control over their annual meeting agendas: largely suspending its substantive review of no-action requests in favor of company discretion and restricting small investors from using Notices of Exempt Solicitation to promote activist campaigns.  Despite the outcry—and even lawsuits—from some shareholder proponents, companies have been judicious in their exclusion decisions, which are tracking in line with the proportion of proposal omissions in 2025.

Shareholder proposal volume shrinks:  After peaking in 2024, the overall volume of shareholder proposal submissions is continuing to contract, with environmental and social (E&S) filings at their lowest level in 10 years.  Proponents held back this year due to steadily declining support levels and last year’s SEC guidance—Staff Legal Bulletin (SLB) 14M— which eliminated the significant social policy override that had previously made it difficult for companies to exclude proposals. Filings of traditional governance resolutions remain robust with this year’s initial votes drawing strong investor support.

Less predictable voting outcomes:  Companies will find it increasingly challenging to forecast proxy votes and gauge shareholder sentiment due to fractured voting and limitations on investor engagements.  As a result of the SEC’s revised guidance last year regarding Schedule 13G eligibility, investors’ engagement discussions have become more circumspect and their proxy voting policies have become more opaque in terms of their voting intentions.  In addition, the Big Three—BlackRock, Vanguard and State Street–have split their stewardship teams which may lead to a divergence in their voting policies over time.  They are also expanding their voting choice programs, which give their clients the ability to follow either in-house or third-party voting policies.

Diminishing proxy advisor influence:  In the face of mounting regulatory and legal pressure at both the federal and state levels, Institutional Shareholder Services (ISS) and Glass Lewis are rethinking their business models in ways that will lessen their influence on shareholder meeting votes. This will become more pronounced in 2027 when Glass Lewis retires its benchmark voting policies and migrates its clients to customized guidelines reflecting their individual stewardship priorities.  Several major asset managers are also distancing themselves from the proxy advisors by bringing their proxy research, data collection and voting in-house, aided by artificial intelligence (AI) technology.

Retail votes will become more consequential:  Individual investors will gain in prominence in proxy votes and corporate communications as a result of pass-through and auto-voting programs.  This season, Exxon Mobil will debut its retail voting program, which allows its retail shareholders to automatically cast their votes in line with the board’s recommendations. Broader adoption by the corporate community could substantially diminish the influence of shareholder activists and special interest groups.

This report delves further into these and other key issues that will impact the 2026 proxy season and beyond.

Shareholder Proposal Omissions

Shareholder proposal omissions are being closely tracked this season following the SEC’s announcement last fall that, due to resource constraints following the government shutdown, it would not be adjudicating no-action requests through September 2026, other than those based on Rule 14a-8(i)(1) where the proposal is not a proper subject for shareholder action under state law.  Companies are at their own discretion in deciding what resolutions to leave off ballots based on the provisions of Rule 14a-8, prior published guidance, and/or judicial decisions.

The SEC additionally revised its Compliance and Disclosure Interpretations (C&DIs) on proxy rules and schedules, stating that it will object to “voluntary” Notices of Exempt Solicitation that are filed by persons owning less than $5 million of the company’s shares, primarily to generate publicity for their shareholder resolutions and “vote no” campaigns.  This has forced shareholder activists to come up with alternative communication channels to share their views on proxy ballot items with other investors².

Omission Trends

Overall, companies have been cautious in their exclusion decisions to avoid investor backlash, which could take the form of opposition to directors, negative publicity and even litigation.  Over half (58%) of the announced omissions were governance proposals, largely sponsored by John Chevedden, of which about one-third (35%) were flagged for procedural deficiencies and 19% were considered substantially implemented, primarily due to a management proposal on the ballot that essentially fulfilled the request.  Nearly half (42%) of the E&S resolutions scheduled for exclusion were regarded by companies as ordinary business (see Table 1).

No company has yet sought no-action relief based on the SEC’s state law carve-out.  Last fall, SEC Chair Paul Atkins suggested that Delaware law does not accord shareholders with a fundamental right to submit precatory proposals³¹.  If a company obtains a legal opinion that precatory proposals are not a proper subject for shareholder action under state law, the SEC staff will likely defer to that position.

Atkins also said that a shareholder proposal that does not meet Texas’s eligibility requirements may be excludable under Rule 14a-8(i)(1).  Last year, the state amended the Texas Business Organizations Code (TBOC) to allow Texas corporations that opt into Section 21.373 to restrict the submission of shareholder proposals to a single or multiple holders of at least $1 million in stock or 3% of the voting shares, whichever is less.  This ensures that shareholder proposals carry the backing of investors with significant, sustained financial interests in the company.  Several companies—including Forward Industries and Texas Capital Bancshares–are availing themselves of this measure as part of their moves to Texas.  At its April 21 annual meeting, Texas Capital Bancshares will hold a separate advisory vote on whether to be governed by the provision.

Investor and Proxy Advisor Reactions

Through April 10, none of the omissions sparked any strong repercussions from investors or proxy advisors in terms of opposition to directors at annual meetings (see Table 2).  Glass Lewis indicated that it will not raise concerns regarding technical omissions, such as submission timeliness and proof of stock ownership, but it will review other types of exclusions case by case.  ISS said that it will not substitute its judgment for that of the SEC in determining whether a proposal is properly excludable under Rule 14a-8.  However, it expects companies to provide clear and compelling reasons for ordinary business and substantial implementation exclusions in their proxy statements³. Failure to do so may be regarded by ISS as a governance failure, which will be flagged in the proxy report or, in rare circumstances, result in a negative ISS recommendation against one or more agenda items, such as the election of directors.

Lawsuits Emerge

Some shareholder proponents are resorting to litigation to keep their proposals on proxy ballots or, in the case of the Interfaith Center on Corporate Responsibility (ICCR) and As You Sow, to block the SEC’s continued implementation of its no-objection policy⁴ ICCR also posted on its website examples of “egregious” unilateral omissions.⁵

Of the six lawsuits filed against companies, three have settled.  AT&T and PepsiCo reached agreements with the New York City Retirement Systems (NYCRS) and the People for the Ethical Treatment of Animals (PETA) Foundation, respectively, not to exclude their resolutions on workforce diversity and animal welfare.  Axon Enterprise also settled a lawsuit filed by the Nathan Cummings Foundation by agreeing to provide detailed annual disclosure of its direct political spending over the next five years.

Still pending are lawsuits against BJ’s Wholesale Club, Chubb, and UnitedHealth Group, which plan to omit resolutions filed, respectively, by the New York State Retirement Systems (NYSCRF), As You Sow and ICCR member Fonds de Missions.  The proposals, which were deemed to constitute ordinary business, deal with deforestation risk, subrogation claims against fossil fuel companies, and the impact of acquisitions on the healthcare system.  In late March, a D.C. federal judge denied As You Sow’s request for a preliminary injunction on the basis that it did not show any likelihood of prevailing on the merits.  However, the judge also declined to dismiss the complaint at this early stage⁶.
The legal actions appear to be having a chilling effect on some companies’ omission decisions.  A number of firms, such as Goldman Sachs Group and Huntington Ingalls Industries, have chosen to include shareholder resolutions in their proxy materials, notwithstanding their view that they could have been properly excluded.⁷.

State Street Investment Management (SSIM)–formerly State Street Global Advisors (SSGA)–has published its 2026 global voting policy updates which are effective April 2026¹.  The material changes, which are discussed below, include embedding financial performance into certain policies, streamlining the framework for evaluating shareholder proposals, and disclosing the guidelines followed by the asset stewardship team when engaging with U.S. public companies.

Financial performance

SSIM has incorporated financial performance, based on total shareholder return (TSR) relative to the company’s Global Industry Classification Standard (GICS) sector, into its assessment of board composition, board oversight of risks and opportunities, and executive compensation. It has removed board diversity factors from its discussion of board quality and composition.  It has also eliminated its section on board oversight of geopolitical risk.

Evaluation of shareholder proposals

In evaluating shareholder proposals, SSIM will consider whether adoption would promote long-term shareholder value in the context of its core governance principles:  effective board oversight, quality disclosure and shareholder protection.  It has removed its previous factors for supporting a shareholder proposal which, in the case of disclosure requests, included satisfying SSIM’s detailed disclosure criteria on issues such as climate change; nature and biodiversity; human capital management; diversity, equity and inclusion (DEI); human rights; and political activities.

Shareholder rights

SSIM has removed its explicit preference for a 25% or less ownership threshold for shareholders to call a special meeting or act by written consent.

Engagement policy

SSIM has added an appendix with guidelines on how its asset stewardship team will conduct engagements with U.S. public companies.  In keeping with last year’s SEC guidance on passive/active investor status, SSIM’s discussion parameters underscore that it does not seek to influence or change control of any issuer, including the following:

• It will not discuss how it intends to cast its vote on any particular ballot item or its rationale for any vote it has made.
• It will not dictate or pressure companies to adopt or change any policies or fundamental business choices.
• It will not engage in discussions that explicitly or implicitly suggest contingent voting or divestment if a company does not adopt SSIM’s viewpoint on a particular item, or that suggest that any particular factor, policy or practice is dispositive in its engagement or voting decisions.

SSIM expects its U.S. portfolio companies to set engagement meeting agendas.  The stewardship team will be in “listen-only” mode during discussions of the following topics with either companies or investors soliciting SSIM’s votes in connection with contested shareholder meetings, “vote no” campaigns, or shareholder proposals:

• Contested director elections
• Adoption of a climate transition plan
• Adoption of specific targets for emissions reduction
• Disclosure, reduction or adoption of a policy on Scope 3 emissions
• Changes to the company’s capital allocation

SSIM further states that it does not apply, nor will its stewardship team discuss, specific targets or thresholds of gender, racial or ethnic diversity in connection with U.S. portfolio companies.

Proxy voting process

In its overview of its asset stewardship program, SSIM deleted references to its use of Institutional Shareholder Services (ISS) to facilitate the execution of its proxy votes, including acting as its proxy voting agent, assisting in applying SSIM’s voting policy, and providing research and analysis relating to general corporate governance issues and specific proxy items. 

Vanguard has published its updated U.S. and global proxy voting guidelines, which take effect in January 2026.

As announced last June, Vanguard has split into two separate investment advisors, Vanguard Capital Management and Vanguard Portfolio Management consisting of distinct investment management and stewardship teams that administer proxy voting for the firm’s internally managed funds¹.  For 2026, they are following identical policies for U.S. companies, though these may eventually diverge in future years.

The U.S. guidelines contain no substantive revisions.  Instead, the language throughout has been amended so that the policy may recommend a particular voting decision rather than stating that the funds will generally vote “for” or “against” a proposal.  Vanguard has also removed detailed factors on certain topics, such as director elections, that would prompt a favorable or negative vote, as discussed below.  This approach is likely the result of SEC guidance issued in early 2025 regarding Schedule 13D/G status.  Vanguard’s policy documents highlight the passive nature of its internally managed U.S. funds, which will not nominate directors, solicit or participate in the solicitation of proxies, or submit shareholder proposals at portfolio companies.

Board composition: Vanguard considers an appropriate mix of skills, experiences and perspectives when examining board composition.  It has removed references to directors’ personal characteristics, such as age, gender and/or race/ethnicity.

Board leadership: Consistent with its prior policy, votes will generally be recommended against shareholder proposals to separate the CEO and chair roles unless there are significant concerns regarding the independence or effectiveness of the board.  Vanguard has deleted from its policy specific factors that would sway it to vote in favor of the shareholder proposal, such as the lack of a robust lead director role, lack of board accessibility, low overall board independence, governance structural flaws, unresponsiveness to shareholder votes, unilateral actions that impair shareholder rights, or oversight failings, including those of a social or environmental nature.

Director capacity and commitments: Vanguard is maintaining its current overboarding policy whereby votes may be recommended against a public company executive who sits on more than two public company boards and other directors who serve on more than four public company boards.  Vanguard has deleted explicit factors that may lead to an exception, such as a public commitment that the director will be stepping down from any directorship(s) necessary to fall within these thresholds.

Director accountability: As in the past, votes may be recommended against directors who fail in their oversight role, fail to act on majority shareholder votes, or take unilateral action that meaningfully diminishes shareholder rights.  Vanguard has eliminated from its policy specific concerns that may spur negative votes, such as “zombie” directors on the board, egregious pay practices, excessive non-audit fees paid to the auditor, unilateral adoption of onerous advance notice or exclusive forum provisions, or failure to oversee material social or environmental risks.

Contested director elections: Vanguard has largely retained the criteria used in its case-by-case evaluation of board contests.  It has removed as a factor whether the board engaged in productive dialogue with the dissident.

Exclusive forum/exclusive jurisdiction: Vanguard will continue to give companies latitude in designating state courts in a company’s state of incorporation or principal place of business as the exclusive forum for adjudicating certain claims.  It has deleted its policy of generally supporting the designation of state courts in Delaware as the exclusive forum. It has also removed its policy of opposing governance committee members if a company unilaterally adopts a forum selection provision that meaningfully limits shareholders’ rights without a compelling rationale.

Hybrid/virtual meetings:  Vanguard has eliminated its specific criteria for supporting proposals to conduct a “virtual-only” shareholder meeting.  It expects such meetings to be designed so as not to curtail shareholder rights, such as shareholders’ ability to ask questions.

BlackRock has released its 2026 updates to the Blackrock Investment Stewardship (BIS) U.S. benchmark policies and engagement priorities which become effective in January 2026¹.

The policy revisions mainly consist of clarifications and changes to wording, particularly in view of the White House executive orders on diversity, equity and inclusion (DEI) and the SEC’s Schedule 13D/G guidance, which were issued in the early part of 2025.  For example, throughout the document, BIS replaced “may vote against” directors with “may not support” directors.  It further noted in its section on shareholder proposals that it is subject to certain rules, regulations, agency guidance and contractual agreements that limit how it interacts with companies.  It explicitly stated that it does not nominate directors for board elections or submit shareholder resolutions to companies.

Other changes include the following:

Board composition:  BIS continues to downplay references to board gender and racial diversity.  Its revised policy states that it may not support members of the nominating/governance committee at an S&P 500 firm where the board is a sustained outlier compared to market practice in terms of having a variety of experiences, perspectives and skillsets.  According to a footnote, this also includes directors’ professional and demographic backgrounds.  BIS has eliminated its previous basis for determining outliers—namely, that 98% of S&P 500 firms had 30% or more diverse representation as of December 2024.

Executive compensation:  BIS added a discussion on executive perquisites, which states that it examines the rationale for certain perquisites, such as security, and whether their appropriateness is regularly evaluated by the compensation committee.

Material sustainability-related risks and opportunities: BIS has clarified that although it considers standardized disclosure of sustainability-related data useful, it does not mandate that companies follow any specific disclosure framework.

Climate and nature-related risk:  BIS has combined its discussion of climate and natural capital risks and indicated that, in both cases, it will convey concerns about board oversight through director election votes or support of a business-relevant shareholder proposal.

BIS has also deleted outdated references, including to the Taskforce on Climate-Related Financial Disclosures (TCFD), which disbanded in 2023, and to earlier research by the BlackRock Investment Institute on the low-carbon transition.  It also removed its expectation that companies stress-test their business models under a range of climate-related scenarios, including the Paris Agreement goal of limiting global warming to well below 2⁰ C.

Companies’ impact on their workforce, supply chains, and communities:  BIS has emphasized that it does not direct a company’s policies or practices on stakeholder relationships, which are the responsibility of the board and management.  It may convey concerns regarding oversight of material risks related to stakeholders through its votes on director elections or support of a business-relevant shareholder proposal.

Human capital management:  BIS has removed its expectation that companies disclose their approach to DEI, as well as their workforce demographics based on EEO-1 Survey disclosures.

Corporate political activities:  BIS adjusted its criteria for supporting a political spending or lobbying disclosure proposal to situations where additional transparency would aid in understanding how the company manages material risks associated with its political activities.  Previously, BIS felt more disclosure was warranted if it was unclear how a company’s political activities supported its strategic policy priorities or if there appeared to be discrepancies.  BIS also deleted references to using third-party research, such as the CPA-Zicklin Index of Corporate Political Disclosure and Accountability, for industry peer comparisons.

Shareholder proposals:  BIS has emphasized its case-by-case approach to shareholder proposals, stating that it may support (rather than is likely to support) disclosure requests that aid in understanding how companies manage material risks that affect their long-term performance.  It will continue to reject shareholder proposals that are inconsistent with long-term financial value or that seek to micromanage companies.

BIS will no longer routinely explain to companies its rationale for supporting shareholder resolutions.  However, its updated policy describes some of the factors it considers when evaluating them:

• Consistency between the specific request made in the proposal, the supporting documentation and the proponent’s other communications on the issue.
• The costs and benefits to the company in complying with the request.
• The company’s governance practices and disclosures relative to those of peers.
• The legal effect of the proposal, such as whether it is precatory or binding or if it would be deemed illegal in a given jurisdiction.

BIS has removed its discussion on escalation efforts, including supporting a shareholder proposal or voting against directors, if a company has not shown sufficient urgency in addressing a material risk.

 

¹ See BlackRock’s 2026 U.S. benchmark proxy voting guidelines and engagement priorities at https://www.blackrock.com/corporate/literature/publication/blackrock-investment-stewardship-benchmark-guidelines-us.pdf and https://www.blackrock.com/corporate/literature/publication/blk-stewardship-priorities-final.pdf.

Glass Lewis has published its 2026 U.S. benchmark policy updates, which will take effect for shareholder meetings on or after Jan. 1, 2026.¹  The substantive changes pertain to mandatory arbitration provisions and Glass Lewis’s pay-for-performance (PFP) methodology, which is addressed in more detail in a separate document.²  Other sections of the guidelines have been clarified, including supermajority voting provisions, certificate and bylaw amendments that reduce shareholder rights, and company omissions of shareholder proposals.

Glass Lewis has also updated the language in the document to clarify that the guidelines contain the views of its benchmark policy, which reflects broad investor opinion and widely accepted governance principles.  Beginning in 2027, it will transition from a single house view to a suite of research perspectives to inform clients’ proxy voting decisions.³

Mandatory Arbitration Provisions

Glass Lewis has amended its benchmark policy to include its approach to mandatory arbitration provisions, which restrict shareholders’ legal recourse and limit the transparency and legal certainty that public court rulings provide.   In September 2025, the SEC issued a policy statement that facilitated companies’ ability to include these provisions in their governing documents, if consistent with state law, when contemplating an initial public offering (IPO).⁴

If a company’s governing documents include a mandatory arbitration provision or other potentially negative provision following completion of its IPO, spin-off or direct listing, Glass Lewis may recommend against the governance committee chair or the entire committee.  Glass Lewis will also oppose any bylaw or charter amendment seeking to adopt a mandatory arbitration provision without a compelling rationale, among other factors. 

PFP Evaluation

Glass Lewis has made significant changes to its proprietary PFP model, including replacing its historical A-F letter grade system with a scorecard-based approach to evaluating PFP alignment relative to Glass Lewis-selected peers over a five-year measurement period.  Final alignment scores, which range from 0 to 100, are determined by the weighted sum of up to six tests, each with their own concern rating (ranging from severe to negligible).  The tests include:

• CEO granted pay vs. total shareholder return (TSR)
• CEO granted pay vs. financial performance (revenue growth, return on equity, return on assets and sector-specific metrics)
• CEO short-term incentive (STI) payouts (as a percentage of target) vs. TSR
• Total named executive officer (NED) granted pay vs. financial performance
• CEO compensation actually paid vs. TSR
• Qualitative features (downward modifier)

This analysis informs Glass Lewis’s voting decisions on say-on-pay proposals.  Companies with an overall rating of “severe” or “high” concern are more likely to receive a negative recommendation.

 Shareholder Rights

Currently, Glass Lewis recommends against the chair of the governance committee, or the entire committee, if the board unilaterally amends the governing documents to reduce or remove important shareholder rights, or to otherwise impede the ability of shareholders to exercise such rights.  Glass Lewis has added the following to its list of board actions that would prompt a negative recommendation:

• The adoption of provisions that limit shareholders’ ability to submit proxy proposals.
• The adoption of provisions that limit shareholders’ ability to file derivative suits.
• The adoption of a plurality, rather than a majority, voting standard in director elections.

The updates reflect recent revisions to the Texas Business Organizations Code (TBOC) which allow publicly listed companies domiciled in the state to impose higher ownership thresholds for shareholders to submit proposals than required under SEC Rule 14a-8.  In addition, certain states, such as Texas and Nevada, have adopted laws permitting companies to impose ownership thresholds for shareholders to initiate derivative actions.

 Amendments to the Certificate of Incorporation and/or Bylaws

Glass Lewis has consolidated its approach to amendments to the certificate and/or bylaws into a single section of the policy document.  In its case-by-case evaluation, Glass Lewis will generally support amendments proposed by management that are unlikely to have a material negative impact on shareholders’ interests, such as technical amendments.  It will continue to discourage the practice of bundling amendments into a single proposal, which could lead to an adverse recommendation if any of the amendments are of significant concern.

Supermajority Voting

Glass Lewis is codifying a case-by-case approach to management proposals to repeal supermajority voting provisions to take into account situations where the company has a large or controlling shareholder and a supermajority requirement may protect the interests of minority shareholders.   In such cases, Glass Lewis will oppose the resolution.  Its current policy favors a simple majority vote to approve all matters presented to shareholders.

Excluded Shareholder Proposals

Glass Lewis adheres to the view that shareholders should be afforded the opportunity to vote on all matters of material importance.   Currently, it makes note of instances where a company has successfully petitioned the SEC to exclude a shareholder proposal through the no-action process.  If it believes that the exclusion is detrimental to shareholders, it may recommend against the governance committee members.

Glass Lewis has removed this guideline in view of the SEC’s mid-November announcement that, due to resource constraints following the recent government shutdown, it will not be responding to most no-action requests through Sep. 30, 2026.  Glass Lewis will monitor the SEC’s ongoing changes to the shareholder proposal process and may update its policy on omissions prior to or during the 2026 proxy season.

Institutional Shareholder Services (ISS) has published its U.S. benchmark policy updates for the upcoming proxy season, which will take effect for shareholder meetings on or after Feb. 1, 2026¹. As detailed below, the revisions mirror the changes ISS proposed in October and are concentrated around the following topics: multi-class capital structures, executive and non-employee (NED) compensation, and environmental and social (E&S) shareholder proposals. Notably, ISS is adopting a more flexible approach to certain issues, including giving companies more latitude in their choice of equity pay awards and their responsiveness to say-on-pay (SOP) votes, as well as moving away from its default position of supporting specific categories of E&S resolutions.

ISS has additionally made minor edits to the policy document, including eliminating information that is duplicated in its U.S. Peer Group, U.S. Executive Compensation Policies and U.S. Equity Plans FAQs, which will be updated in mid-December.

Problematic Capital Structure/Unequal Voting Rights

ISS is eliminating inconsistencies in its treatment of capital structures with unequal voting rights by considering them problematic regardless of whether superior voting shares are classified as “common” or “preferred.”  Preferred shares that only have voting rights with respect to items that affect their class of holders are not considered problematic.

ISS will oppose management proposals to create a new class of preferred stock with voting rights superior to the common stock with the following exceptions:

• Convertible preferred shares that vote on an “as converted” basis; or
• The enhanced voting rights of the preferred shares are limited in duration and applicability and are voted in a way that mirrors the votes of the common shares.

The same exceptions will apply to ISS’s policy of recommending against directors, committee members or the full board (other than new nominees) at companies that maintain multi-class capital structures with unequal voting rights.

 Long-Term Alignment in Pay-for-Performance (PFP) Evaluation

ISS is extending the time horizon of its U.S. PFP quantitative screens (Relative Degree of Alignment and Financial Performance Assessment) from three years to five years to better reflect how investors assess a company’s long-term performance when evaluating CEO compensation relative to peers.

ISS’s assessment of pay quantum (Multiple of Median test) will now incorporate both one-year and three-year views of CEO pay relative to peers to smooth out short- to mid-term fluctuations, unusual one-time events, or external factors.

 Time-Based Equity Awards with Long-Term Time Horizon

ISS is taking a more flexible approach in evaluating the equity pay mix in its PFP qualitative analyses whereby time-based equity awards with extended time horizons will be viewed positively.

Although ISS did not provide further details, a plurality of investor respondents to its 2025 policy survey considered time-based awards with three-year vesting plus a two-year post-vesting retention requirement to be sufficiently long-term to dispense with performance requirements for part or all of executives’ long-term incentive awards.

Company Responsiveness to SOP Votes

ISS will be more flexible towards company responsiveness to a low (less than 70%) SOP vote in the prior year in cases where shareholder feedback is difficult to obtain because of recent SEC guidance regarding Schedule 13G (passive) versus Schedule 13D (active) filing status for institutional investors.  If a company discloses that it attempted but failed to elicit sufficient feedback from its investors, ISS will assess the company’s actions taken in response to the vote and how they are beneficial to shareholders when recommending on the reelection of compensation committee members.

ISS has also clarified the factors it considers in the case of low SOP support related to an unusual situation, such as a proxy contest, merger or bankruptcy.  In addition to the disclosure of engagement efforts and relevant compensation actions, ISS will take into account significant board turnover.

High NED Pay

ISS is expanding its policy on high NED compensation, allowing for adverse recommendations against the responsible board committee in the first year of occurrence of highly problematic pay or when a pattern emerges across non-consecutive years.  Currently, negative recommendations are only triggered after two or more consecutive years of excessive NED pay absent a compelling rationale or other mitigating factors.

Problematic NED pay practices include large pay magnitude; performance awards, retirement benefits and excessive perquisites; and inadequate disclosure of the rationale for unusual payments.  NED pay practices that are only marginally problematic in the absence of other escalatory factors or multi-year patterns will continue to receive warnings only.

Equity Plan Scorecard (EPSC) Enhancements

ISS is adding a new scoring factor under the Plan Features pillar of its EPSC that will assess whether equity plans that include NED participation disclose cash-denominated award limits, which is considered best practice.  For 2026, the NED individual award limit factor will only apply to S&P 500 and Russell 3000 ESPC models.

ISS is also introducing a new overriding negative factor where an equity plan proposal will receive a negative recommendation if it lacks sufficient positive features under the Plan Features pillar, despite an overall passing score.  For 2026, this will apply to S&P 500, Russell 3000, and non-Russell 3000 EPSC models.

E&S Shareholder Proposals

ISS is implementing a fully case-by-case approach to shareholder proposals on diversity, political contributions, human rights and climate change/greenhouse gas emissions to reflect shifting investor sentiment, declining support for such proposals, regulatory changes and evolving company practices.  Currently, ISS generally recommends in favor of such proposals, though its level of support has been falling in recent years.²

Globally, ISS will continue to apply a consistent case-by-case framework to its evaluation of E&S proposals.  It is adding a new factor on whether the proposal addresses substantive matters that impact shareholders’ interests, including shareholder rights.

Overview

In a year that opened with trade uncertainty, inflation jitters and market volatility, much of the dust has settled and given way to greater economic clarity, resilient earnings growth and record market highs.  The midpoint of the year is ushering in a new phase of economic transformation with the establishment of a stablecoin payment system under the GENIUS Act and a national discourse on the Federal Reserve System.

Underpinning this process has been a shift to a more business-friendly regulatory framework, which included the de-escalation of environmental, social and governance (ESG) agendas, particularly climate change and diversity, equity and inclusion (DEI) initiatives.  For companies, this resulted in fewer and less successful demands from ESG adherents during the 2025 proxy season, other than those relating to core corporate governance principles.

Some of the trends observed during this year’s annual meetings include the following:

• Scale-back of shareholder proposals: The volume of shareholder proposal filings through June (841) subsided substantially after reaching its highest level last year (1,034) since 2015 (see Tables 1 and 2).   Submissions of environmental and social (E&S) resolutions were down by nearly a quarter from last year’s peak as proponents awaited an expected course change by the incoming Trump administration and the GOP-led SEC.  Omissions also ran higher than last year–24% of all filings compared to 14% in 2024—due in part to new SEC guidance that facilitated the exclusion of proposals that focus on significant social policy issues.  Given the more favorable landscape for no-action challenges, filings of E&S resolutions are likely to remain suppressed going forward.
• More companies relented on governance measures: The volume of governance filings remained fairly constant from last year (302 versus 318 in 2024) due in large part to the persistence of corporate gadfly John Chevedden and his affiliates who sponsored over half of them.  Standard-themed governance measures amassed 45 majority votes and in nearly two dozen cases the boards chose not to oppose the resolutions.  Another 40 companies countered the shareholder resolutions with their own charter and bylaw amendments.
• E&S support contracted further: For a fourth consecutive year, support for E&S resolutions lost ground, not only from investors but also from proxy advisors, particularly Institutional Shareholder Services (ISS), which backed a mere 12% of them compared to over half in 2024 (see Table 3). Excluding proposals from conservative (“anti-ESG”) investors, which typically receive marginal support, average E&S votes reached only 14.8%, down from 19.7% in 2024.  Only 14 proposals attracted over 30% support, 11 of which were on political contributions including five majorities.
• ESG crossfire intensified: Conservative proponents produced 129 filings this season—up slightly from 120 in 2024—with over 80% devoted to social issues, particularly DEI themes.  Ten companies faced competing pro- and anti-ESG resolutions on DEI, climate change and plastics recycling.   Notwithstanding the high proposal volume, conservatives’ E&S initiatives continued to attract only marginal support—2.2% on average—though they recorded several standout votes on human rights due to rare support from the proxy advisors.
• Executive compensation and director approvals remained solid: Say on pay (SOP) voting patterns were essentially unchanged from the first half of 2024 in terms of average support (90.5%), the rate of failures (1.3%), and the proportion receiving a negative ISS recommendation (12.3%).  Directors also elicited strong support with 17% fewer facing high opposition votes (over 30%) than in the 2024 proxy season due in part to changes in investor policies on board diversity, overboarding and director accountability on E&S matters.  A number of hedge funds also shifted gears by passing on full-scale proxy fights in favor of “vote no” campaigns, which generated some headway on desired leadership changes.
• More competition in state migrations: Reincorporation activity became livelier with Delaware, Texas and Nevada vying for business by implementing major amendments to their respective corporation laws.  Although Nevada was the preferred destination for “DExits,” Texas made the most innovative changes to its statutes, including allowing companies to impose meaningful ownership requirements for shareholders to submit proposals and mandating a disclosure regime for proxy advisors when their voting advice on Texas companies is based on non-financial factors or conflicts with the board’s recommendations.

This report examines some of the predominant themes, voting results and trends at all U.S. public company annual meetings during the first half of 2025. Note that shareholder proposal votes are based on “for” and “against” votes and exclude abstentions.  Shareholder proposal submissions are estimates based on SEC filings, proponent websites and media reports.   Proxy advisor recommendations are derived from ISS Voting Analytics and Diligent Market Intelligence.

Table 1: Shareholder Proposal Voting Trends

*Of the 2025 majority votes, 22 governance proposals were not opposed by the board.
Of the 2024 majority votes, 15 of the governance proposals were not opposed by the board.
Of the 2023 majority votes, five of the governance proposals and one of the E&S proposals were not opposed by the board.

Table 2: Top Shareholder Proposal Filings: 2025 (as of June 30) – 2024 (full year)

*These proposals were filed by Chris Mueller and his affiliates regarding companies’ direct stock purchase plans offered through their transfer agent, Computershare. All were omitted or withdrawn due to company challenges on ordinary business or procedural defect grounds.

Table 3: ISS and Glass Lewis Support for Shareholder Proposals

Regulatory Backdrop

During its first six months, the Trump administration took swift action to revitalize and modernize the economy and position the U.S. as a leader in technological innovation which, by mid-July, culminated in “Crypto Week” legislation on Capitol Hill and the unveiling of an artificial intelligence (AI) action plan.¹2  These directives were backed up with enforcement actions, such as Federal Communications Commission (FCC) investigations into the DEI practices of several media and wireless companies, particularly those awaiting regulatory approval of mergers and acquisitions.

Other EOs reasserted American energy independence by removing impediments to domestic energy production and rolling back the Biden administration’s climate regulations, including withdrawing the U.S. from the Paris Agreement and other climate-related financial commitments.  A follow-on EO issued in April took aim at state-level climate laws and litigation designed to hold fossil fuel companies financially responsible for alleged harms caused by climate change.³  The SEC also signaled its probable intent to roll back the 2024 climate disclosure rules by ending it defense of them against legal challenges.

Other SEC actions had a direct bearing on the 2025 proxy season.  In February, the Division of Corporation Finance took immediate steps to restore balance to the no-action process and address longstanding complaints from issuers and institutional investors regarding the rising volume of shareholder proposals and the lower quality of many, including being overly prescriptive, substantially implemented or lacking economic merit.  New interpretative guidance—Staff Legal Bulletin (SLB) 14M—essentially rescinded Biden-era guidance (SLB 14L) that had made it harder for companies to exclude shareholder proposals that raised broad societal concerns.  The SEC additionally updated its guidance on Regulation 13D-G beneficial ownership reporting to discourage large investors from being coercive in their engagements

with issuers, such as conditioning their support of board nominees on companies adhering to their policies on governance, compensation and E&S matters.

The result was a noticeable retreat by investors and proxy advisors from advancing ESG agendas this season.  To avoid triggering Schedule 13D requirements, large asset managers shifted to engagement “lite” discussions, purged or softened references to DEI and ESG in their voting and stewardship guidelines, and limited their issuance of periodic vote bulletins during proxy season.  Meanwhile, the proxy advisors scrambled to adjust their quota-style board diversity policies: ISS suspended the application of its policy and Glass Lewis offered its clients an alternative to its benchmark policy that did not consider gender and underrepresented community diversity.

Going forward, federal and state lawmakers are turning more attention to the proxy advisory firms over their market power, conflicts of interest, foreign ownership, and lack of economic analysis underpinning their voting recommendations.⁴  To deflect this, Glass Lewis announced in May that it will encourage and assist its investor clients in creating their own proxy voting guidelines and, beginning in 2026, it will open its platform to third-party voting policies as alternatives to Glass Lewis’s policy options.

E&S Issues

E&S on the Downswing

Anticipating post-election policy changes, E&S proponents scaled back their proposal submissions by nearly a quarter to their pre-SLB 14L level: 468, down from 610 last year.

Even with the cutback, fewer than half of the E&S proposals filed reached ballots this season due to a high proportion of omissions: 21% compared to 8% in 2024.  While SLB 14M was a contributing factor, there had already been an increasing trend of ordinary business exclusions in recent years, which was the basis for 71% of the E&S omissions this year, compared to 68% in 2024.

The rate of confirmed withdrawals (24%) was generally consistent with last year, though in about half of the cases they occurred after the targeted companies sought no-action relief.  And unlike in past years, proponents have been more reticent about broadcasting the details of settlements reached with companies.

Investors’ support for E&S issues fell for a fourth consecutive year, reflecting shifts in their 2025 voting and stewardship policies deemphasizing ESG and DEI expectations.  Excluding conservative resolutions, which investors rarely endorse, average support fell to 14.8% from 19.7% in 2024 and a high of 39.5% in 2021.  Only 14 E&S proposals (6% of those voted) generated over 30% support, compared to 56 last year (15% of those voted).  Proposals on political spending disclosure—largely sponsored by Chevedden—were the silver lining, delivering five majority votes and another six achieving 30-50% support.

A more striking development was the loss of proxy advisor support for many of this year’s E&S efforts.   Excluding proposals from conservatives, Glass Lewis’s backing dipped to 32% from 41% in 2024, while ISS’s support plunged to 12% from 55% in 2024.  Notably, ISS did not support any environmental resolutions this year and it largely stayed sidelined on the DEI proposals.

Conservatives Keep up the Pressure

Unlike their liberal counterparts, conservative proponents increased their share of filings, which stood at 129 by mid-year, up from 120 in 2024, and accounted for 24% of all E&S submissions, compared to 18% last year.  In addition to seasoned activists, such as the National Legal and Policy Center (NLPC) and National Center for Public Policy Research (NCPPR), their ranks expanded to include the Heritage Foundation, GuideStone Capital Management, the Catholic Diocese of Fort Worth, Investing with Purpose Capital, and the Oklahoma Tobacco Settlement Fund.

Over 80% of conservative proposals focused on social issues with one-third directed at corporate DEI programs and policies.  Despite the high proposal volume, their E&S initiatives continued to attract only marginal support—2.2% on average—though they recorded several standout votes on human rights due to rare support from the proxy advisors.

Ten companies faced competing pro- and anti-ESG resolutions, primarily on DEI, but also on carbon reduction goals and plastics recycling.  Walmart navigated this by writing one rebuttal for both proposals in order to avoid taking sides on sensitive and polarizing issues.

DEI and Discrimination

DEI has been one of the most challenging issues confronting companies this spring in view of the 2023 U.S. Supreme Court decision in Students for Fair Admissions v. Harvard, Robby Starbuck’s 2024 social media campaign and President Trump’s EOs.

The result has been extensive rollbacks of corporate DEI policies and programs, particularly by federal contractors and companies in highly regulated industries.  According to a Gravity Research study, the most significant changes have been around hiring and representation goals, along with a recasting of “DEI” into more innocuous terms, such as “inclusion and belonging.”  Companies have also scrubbed mentions of DEI from corporate reports, regulatory filings and websites.

Although this year’s DEI proposal submissions predated the Trump administration’s directives, the impact of the EOs was seen in a shift by investors and proxy advisors towards more neutral positions.  There was also a surge in resolutions from conservative proponents, leading to pro- and anti-DEI face-offs at six companies’ annual meetings.

Pro-DEI

For the most part, pro-DEI proponents resumed their longstanding proposals calling for racial equity/civil rights audits, disclosure of EEO-1 data, and reports on the effectiveness of companies’ DEI efforts.

The latter type of proposal—primarily sponsored by As You Sow–has been the most popular over the past three years with many getting withdrawn, typically if the company agrees to disclosure outcome statistics, such as workforce hiring, promotion and retention data by gender, race and ethnicity.  However, the six voted this season saw a substantial decline in investor support, averaging 12.8% compared to 23.2% in 2024, with the lowest votes occurring on repeat proposals at International Paper and Lennar that were specific to LGBTQIA+ equity and inclusion efforts.   ISS declined to back any of the resolutions, despite supporting 85% of them last year, while Glass Lewis endorsed about half of them.

In contrast, support for racial equity/civil rights audits held up from last year, averaging 13.9%, with the highest vote appearing early in the season at Deere (29.5%)–the only one backed by ISS. This year’s collection also included a new variation by Chevedden, which specified that the audit adhere to the Civil Rights Audit Standards developed by PolicyLink in conjunction with a group of corporate executives, investors, union and worker representatives and civil rights experts.⁵

Only a handful of resolutions were directed at companies that walked back some of their DEI commitments in 2024, specifically, to report on the research and analysis the board undertook before taking such action.  Two were omitted as ordinary business by Harley-Davidson and Tractor Supply and one was withdrawn at Ford Motor.

Anti-DEI

Leveraging the momentum from Starbuck’s campaign, conservatives ramped up their requests for companies to address the legal and reputational risks of maintaining their DEI or affirmative action programs including potential discrimination against “non-diverse” employees and vendors. For the first time, they also took a more direct approach by asking nearly a dozen companies to consider abolishing their DEI efforts or to cease participating in the Human Rights Campaign’s Corporate Equality Index (CEI), which rates companies on LBGTQ+ workplace equality.

Another new angle from Bowyer Research took issue with four companies’ lack of faith-based employee resource groups (ERGs), despite recognizing ERGs formed around race, gender identity, military status and other criteria.  Department of Justice (DOJ) and Equal Employment Opportunity Commission (EEOC) guidance on the DEI-related EOs emphasized that limiting membership in ERGs or affinity groups only to employees of a certain gender, race or ethnicity may constitute unlawful segregation.⁶  According to Gravity Research’s study, companies are addressing this by opening their ERGs to all employees and aligning them with business priorities, such as professional development and networking.

Voting outcomes across the 23 proposals failed to pick up steam from last year, receiving an average of 1.6% support. The one standout was a proposal on affirmative action risk at Target, which received 7.2% and the backing of Glass Lewis.

Conservatives additionally carried over the theme of religious discrimination to 14 newly formulated resolutions on charitable giving.  Whereas their prior proposals sought disclosure of recipients above certain donation amounts, the 2025 iterations dealt with companies’ charitable partnerships—particularly with organizations that have maligned and suppressed conservative political and religious views–and the exclusion of religious charities from companies’ employer gift-match programs.  The new versions were less well-received by investors, averaging 1.2% compared to 2.9% in 2024 and a high of 7.1% in 2023.

Competing Pro- and Anti-DEI Proposals

Key Diversity and Discrimination Proposals

Climate Change

The Trump administration’s EOs and potential pullback from the climate disclosure rules reflect longstanding efforts by Republican state attorneys general (AGs) and Congressional lawmakers to protect American energy, particularly against boycotts and the defunding of fossil fuel companies.  Since 2022, major U.S. banks and asset managers have been pulling out of global climate collaborations, including Climate Action 100+, the Net Zero Banking Alliance (NZBA) and the Net Zero Asset Managers Initiative (NZAM), over anti-trust investigations.  In May, the DOJ and Federal Trade Commission (FTC) filed a statement of interest supporting an anti-trust and consumer protection lawsuit brought by 11 state AGs alleging that BlackRock, State Street and Vanguard Group used their common shareholdings and commitments in industry-wide climate initiatives to suppress U.S. coal production.⁷

As a result, companies are facing less investor and regulatory pressure to pursue net-zero decarbonization goals.  According to the Wall Street Journal, during the first five months of 2025, proxy statement mentions of “net zero” dropped 32%, references to “carbon neutral” declined 30%, and references to Scope 1, 2 or 3 emissions fell 24% from the same period in 2024.

Investor support for climate change resolutions has also fallen dramatically.  Excluding those from conservatives, climate-focused proposals saw a nearly 50% drop in average support this year to 12.3% from 23.9% in 2024.

GHG Emissions

Proposals on greenhouse gas (GHG) emissions reduction were down by over one third from last year with 41 submitted—the lowest level since 2021.  They also fell short in the vote tally, averaging only 12.6% support, compared to 27.5% in 2024.

Five proposals were deemed excludable as micromanagement.  These generally asked for a climate transition plan in alignment with the Paris Agreement goals.  About a half dozen others were withdrawn due to continuing dialogue or commitments.

Proponents steered clear of Exxon Mobil, which faced no shareholder proposals whatsoever at its annual meeting after it sued Arjuna Capital and Netherlands-based Follow This last year to keep a recurring GHG reduction resolution off the ballot.  CEO Darren Woods vowed to resort to litigation again if activist shareholders continued to abuse the proxy proposal process.  This year, Follow This backed off filing any climate resolutions at major oil and gas companies—the first time since 2016—deciding that it would be counter-productive given the “current political pro-fossil fuel agenda.”

AI Data Centers

An emerging issue this year was how tech companies will meet their climate change-related commitments in view of the growing energy demands of their expanded AI data center operations.  Notwithstanding a

lack of proxy advisor support, the resolution achieved 20.1% at Amazon.com, though only 3.3% at Meta Platforms.

Financed Emissions

This year’s resolutions on climate change finance put a heavier emphasis on insurers than banks, where 2024 proposals seeking reports on net zero-unaligned clients were deemed excludable as micromangement.

Instead, As You Sow and the New York City Retirement Systems (NYCRS) repeated their requests for major financial institutions to annually disclose their clean energy financing ratios, which compare their financing for low-carbon energy projects versus fossil fuel projects.  These survived ordinary business challenges and last year resulted in two targets–Citigroup and JPMorgan Chase–agreeing to comply.  However, this year’s effort backslid with lower average votes than in 2024–13.2% versus 25.9%–due to the loss of ISS support.  Glass Lewis opposed the initiative in both years.

At insurers, As You Sow and Green Century Capital Management continued advocating for the disclosure of GHG emissions from their underwriting, insuring and investment activities.  Relying on SLB 14M, two targets—Allstate and Hartford Insurance Group—succeeded in omitting more prescriptive versions of the proposal as micromanagement.  These called for time-based targets or the alignment of emission reduction efforts with the Paris Agreement goals.

As You Sow also introduced a new variation asking Travelers Companies to explain the impact on its homeowners’ insurance customer base of higher pricing and the loss of coverage due to climate-related factors, such as more frequent and intense weather-related natural disasters and storms.  This received 12.6% support and, taken together, the insurance-focused resolutions averaged 13.8% support, down from 25.7% in 2024 when some were backed by the proxy advisors.

Conservative Pushback

For nearly two decades, conservative proponents have posed the issue of risks arising from companies’ voluntary carbon reduction commitments, including the feasibility of net-zero goals, their legitimacy based on scientific evidence, and the potential for fraud or misconduct allegations from greenwashing.  This year’s lineup also included a more direct approach by NLPC asking several oil majors to eliminate all emissions reduction targets covering their operations and energy products.

The vote result average (2%) was unchanged from last year, with the highest score occurring for a second time at United Parcel Service—6.2% compared to 8.1% in 2024.

Environmental Protection

Recycling was the most popular topic among other types of environmental proposals with 27 submissions—the highest number ever—with most focusing on plastics use in the consumer goods, food service and hotel sectors.  Proponents undertook several new initiatives this year on misleading recyclability labeling, tire shedding and food waste.

Plastic Pollution and Recycling

As You Sow focused half of its recycling resolutions on the phase-out of flexible plastic packaging because of missed 2025 plastic reduction and recycling targets established by the Ellen MacArthur Foundation’s U.S. Plastics Pact (USPP).  Flexibles and films are difficult to recycle because of their multi-layer, multi-material design.  Votes averaged 13.3% across six companies.

Beginning in 2022, As You Sow broadened its campaign on plastic pollution, initially by urging petrochemical companies to move away from virgin plastic to recycled polymer.  Last year, it shifted to plastic microfiber shedding, concentrating on the textile industry.  This season, it asked Goodyear Tire & Rubber to set tire wear shedding reduction goals, which garnered 5.6% support.

Green Century and The Last Beach Cleanup urged six companies to report on the legitimacy of their recyclability and recycled content claims on their plastic packaging labels.  Three proposals were withdrawn and the remainder averaged 9.8% support.

In a first-time initiative, NLPC countered liberal proponents by asking Colgate-Palmolive (2.9%) and Walmart (0.5%) to reexamine their plastic packaging policies based on credible scientific and economic analysis.  Walmart bowed out of the USPP this year, as did Mondelez International which was a target of both As You Sow and The Last Beach Cleanup.

Food Waste

Following its successful GHG reduction proposals last year, The Accountability Board (TAB) took up the topic of food waste, which was last addressed by other proponents in 2021.  Unlike the earlier versions, which focused on hunger and methane emissions from food decomposing in landfills, TAB’s thrust was the environmental impacts from the production of wasted food– GHG emissions and the consumption of freshwater, fertilizer and other resources.

TAB asked nine restaurant and retail companies to measure and set targets for reducing the food waste they generate, which resulted in 11% average support for the six voted.  Two others were withdrawn and one (at McDonald’s) was omitted as micromanagement.

Key Environmental Proposals

Human Rights

For the most part, human rights proposals did not deviate from recent themes, such as the adoption of comprehensive human rights policies and due diligence processes (HRDD), operations in conflict-affected and high-risk areas (CAHRA), indigenous people’s rights, and child exploitation.

AI factored into many of the proposals on data privacy and censorship aimed at Big Tech, while a new angle on the human right to water dealt with water scarcity due to AI data centers’ cooling requirements.

For a second year, faith-based organizations framed their advocacy on drug pricing and access to medicine as human rights impact assessments (HRIA), which averaged 21.2% at three pharmaceutical companies while another two were withdrawn due to agreements.   In 2024, only one proposal was voted at Eli Lilly (10%), which succeeded in excluding this year’s petition as micromanagement.

Along with Domini Impact Investments, religious orders also repeated their call for worker-driven social responsibility (WSR) reports.  The proponents contend that WSR is a more effective model for identifying and remedying human rights abuses, such as in agricultural supply chains at this year’s targets, Kroger (15%) and Wendy’s (7.6%).

Conservatives versus Liberals

Human rights is one topic where proponents on the left and right share some common ground, particularly on child exploitation, data privacy and business dealings with countries that have a record of human rights abuses.  Historically, voting results have been vastly different, but that gap is closing due to increased proxy advisor support for conservative-sponsored proposals.

This year, Glass Lewis supported six of their human rights resolutions at tech companies: two on child safety online by Bowyer Research and four on ethical AI data acquisition and usage (data privacy) by NLPC.  ISS backed two of the same data privacy resolutions, lifting average support to 11.2%, making it the top-performing conservative initiative on E&S.   In comparison, liberal versions of data privacy proposals, mostly on AI-driven advertising policies, averaged 12.6%, while their resolutions on child safety online averaged 11.4% (compared to 7.7% for conservatives).

Key Human Rights Proposals

Labor Rights

Shareholder proposal activity by organized labor was relatively subdued compared to recent years of heightened unionization activity and large-scale worker strikes.  Union pension plans substantially pared back their 2025 filings to 58 resolutions from 98 in 2024.  Their primary areas of focus continued to be workplace health and safety and freedom of association/collective bargaining rights.

Unionization Rights

In conjunction with their organizing efforts, labor proponents asked 10 companies in various industries to uphold the rights to freedom of association and collective bargaining in their operations as reflected in the International Labor Organization’s (ILO) Declaration on Fundamental Principles and Rights at Work.  Since this campaign began three years ago, average support has been steadily declining from a high of 36.2% in 2022 to 14.1% in 2025.  Only a handful of the resolutions went to a vote with most omitted as ordinary business.

In a first-time initiative, NLPC countered the union proposals by asking Starbucks to study the human rights risks related to labor organizing efforts, including how the company is protecting the rights of employees

who do not wish to be represented by a union as well as negative impacts on shareholder value.  The resolution received 1% support.

Worker Health and Safety

For a third year, the SOC Investment Group and other proponents raised concerns about unsafe working conditions atrestaurants and retail stores, typically by calling for independent, third-party audits.  This year, only three proposals went to a vote, averaging 16.1% support, with most of the others succumbing to ordinary business challenges.  A separate initiative on airline workers’ exposure to extreme heat was settled with the targeted companies.

AI Governance

AI-related proposals largely shifted this year from worker impacts to broader human rights concerns, such as privacy intrusions.  Only a handful of resolutions continued the theme of responsible AI governance, including board oversight of AI usage and ethical guidelines to protect workers from job automation, wage discrimination and bias in employment decisions.  These averaged 9% support, down from 19.1% in 2024.

Key Labor Proposals

Political Activities

Political spending disclosure was the most successful E&S initiative this season, bolstered by near universal support from ISS and Glass Lewis.  Five proposals received majority votes and overall average support rose to 41.8% from 25.8% in 2024.  Almost all were sponsored by Chevedden.

Resolutions on lobbying disclosure continued to be the most abundant type of political activities filing. However, most were absent from this year’s corporate ballots after Air Products and Chemicals successfully argued to the SEC last fall that the request constituted micromanagement by narrowly focusing on the company’s association with specific organizations and by requiring the reporting of dozens of distinct pieces of information.  Twenty-three other targeted companies followed suit, resulting in another 16 omissions and seven withdrawals after being challenged on the same basis.  The seven voted—all of which were opposed by ISS—averaged 14.5% support, down from 29.1% in 2024.  Glass Lewis backed

all but one of the resolutions (at Visa).  The American Federation of State, County and Municipal Employees (AFSCME), which is coordinating the campaign, plans to rework the proposals for 2026.

Proxy Impact and religious orders introduced new proposals this year calling for the alignment of lobbying and political influence activities with human rights policies.  The underlying issues included Alphabet’s child safety policies and commitments (5.3%) and Lockheed Martin’s foreign military sales to customers linked to human rights violations (9.8%).

Key Political Influence Proposals

Governance Issues

Governance Proposals

Resolutions on traditional governance measures scored the highest number of majority votes this season—45 in all advocating for board declassification, special meeting and written consent rights, the repeal of supermajority voting provisions, and a sale or merger of the company.  Because of the near universal appeal of these provisions among institutional investors, 22 companies chose not to oppose the proposals while about 40 companies countered them with competing charter or bylaw amendments.⁸

Chevedden and his affiliates continued to be the leading sponsors of governance initiatives, accounting for more than half of the over 300 filed this year.  TAB, which primarily focuses on the food sector, also more than doubled its efforts in the governance space with 18 proposals, up from seven in 2024.

Individual investor Chris Mueller resurfaced for a second year with 41 proposals addressing concerns related to direct stock purchase plans, such as offering “print on demand” stock certificates, protecting securities against abusive short-sellers, and providing transparency around arbitrage exposure enabled through recurring direct stock plan purchases.  As in 2024, these were readily omitted as ordinary business or for procedural deficiencies.

As discussed below, proponents added some new spins to standard-themed governance proposals, but these failed to generate strong investor support.

Special Meetings

Resolutions calling for the adoption or enhancement of special meeting rights were the most abundant shareholder proposal filing this season with 73 submissions, the highest number since 2022 (120).

Most continued to advocate for low (10% or 15%) share ownership requirements, which averaged 47.4% support, up from 43.9% in 2024.  Nine proposals won majority approval at companies that had high (40% or more) ownership thresholds or no special meeting rights at all.

This year, Chevedden embellished his submissions with nearly two dozen that simply called for the elimination of one-year holding periods in companies’ ownership requirements.  These averaged only 10.9% support–below the 11.6% received when he last introduced them in 2023.  ISS opposed all of the resolutions, while Glass Lewis only supported those where the company’s ownership threshold was above Glass Lewis’s preferred level of 10-15%.

Dual-Class Stock

Shareholder resolutions pertaining to dual-class stock with unequal voting rights took two forms this year.  Standard proposals calling for a recapitalization plan so that all outstanding stock has one vote per share averaged 21.9%, down from 33.5% in 2024.

A new variation introduced last year at Meta Platforms, asked that voting results be disaggregated by each class of shares to better identify the concerns of the independent shareholders.  Although ISS and Glass Lewis supported this initiative, the resolutions received lower average support (12.8%) than the recapitalization proposals, including at Meta Platforms which received both types of resolutions (20.6% versus 25.8%).  In addition to the three voted, another proposal was withdrawn at Hershey due to an agreement.

Director Resignation Policy

For a second year, the United Brotherhood of Carpenters and Joiners of America attempted to interest investors in a mechanism that would force directors who fail their election to step down from the board within 90 days after the vote certification.

To avoid last year’s exclusions for state law violations, the Carpenters presented three proposal variations.  Most called for a policy requiring a director to resign after two consecutive years of failed elections.  In one version, which the Carpenters plan to refile in 2026, the board would have the flexibility to accept or reject the first year’s resignation based on its business judgment.

The 13 resolutions voted garnered 20.8% support on average—up from 17.6% for the eight voted in 2024.  ISS has consistently opposed the resolutions while Glass Lewis supports them.

Board Declassification

As occurred in 2024 at Warrior Met Coal and News Corp, shareholder activists are continuing to advance governance reforms through their own proxy solicitations, thereby bypassing the Rule 14a-8 no-action process.

In conjunction with its proxy fight at Phillips 66, Elliott Investment Management tried a creative approach to declassifying the board, where repeat management resolutions had failed to receive the requisite 80% approval to effect the change through a charter amendment.  Elliott’s workaround was a Rule 14a-4 proposal calling for a policy requiring all incumbent directors, regardless of class, to submit letters of resignation in advance of each annual meeting.

Although the measure posed issues of legality under Delaware law and the company’s governing documents, it received 32.9% support and was endorsed by Glass Lewis but rejected by ISS.  Meanwhile, the company’s proposal to declassify the board via a charter amendment failed for the sixth time.

Bitcoin Diversification Strategy

NCPPR revisited the potential merits of cryptocurrency as an inflation hedge by asking some half dozen companies to assess whether adding Bitcoin to the corporate treasury would be in the long-term interests of shareholders.  The resolution was first introduced last fall at Microsoft and this year received similarly meager support (less than 1%) at Meta Platforms.  The remaining submissions were omitted as micromanagement.

Key Governance Proposals

* Of the 2025 majority votes, 22 governance proposals were not opposed by the board.
Of the 2024 majority votes, 15 of the governance proposals were not opposed by the board.

Director Votes

Directors attracted strong levels of support with 17% fewer receiving high opposition votes (over 30%) than in the first half of 2024.  This was due in part to investors moving away from numeric requirements on board diversity and overboarding and backing off director accountability votes on E&S issues.

Sixty-two directors at 43 companies received a majority of opposition votes—comparable to the first half of 2024—which in many cases was due to compensation concerns, director independence, poor meeting attendance, and board responsiveness—particularly in regard to “zombie” directors who remained on the board despite a majority of votes being cast against their reelection last year.  Only 10 of the 43 companies had majority voting and/or a director resignation policy, and four of the boards did not accept the resignations while two others are in deliberation.

An emerging trend was the inclination of hedge fund activists to wage “vote no” campaigns rather than running competing board slates.  While this strategy is less likely to unseat incumbents, significant shareholder dissatisfaction can send a strong message to boards and give the dissidents negotiating leverage, as occurred in several cases from this year’s proxy season:

• H Partners Management conducted a direct solicitation urging Harley-Davidson shareholders to withhold votes from three board members–the Chairman/CEO, presiding director and the longest-tenured director. Although all were reelected by slim margins (51%-59%), the dissident claimed to have won concessions on leadership changes—namely, that the three directors privately committed to key shareholders that they would step down before the 2026 annual meeting.
• Ancora Holdings Group’s withhold campaign at Forward Air succeeded in forcing out three legacy directors. The board chair failed to win majority support and resigned per the company’s director resignation policy.  The other two targeted directors, who received narrow investor support (52% and 62%), voluntarily resigned.
• Impactive Capital’s “vote no” campaign at WEX generated sufficient opposition to the Chairman/CEO and two other directors (31%-37%) that the dissident announced its intent to nominate at least four director candidates at the company’s 2026 annual meeting.

Reincorporations

Reincorporation activity picked up this year with nearly two dozen companies proposing to depart Delaware for other jurisdictions due in large part to the heightened litigious environment and recent court decisions that have called into question the predictability of Delaware law.   Nevada was the preferred destination for 16 of the companies, followed by Florida (two) and Texas (two with one–MercadoLibre—backing out).

To stave off the outflow, Delaware amended the Delaware General Corporation Law (DGCL) this spring by establishing safe harbors for controlling shareholder and interested party transactions, clarifying the definition of a controller, and limiting the scope of books-and-records demands.  Even so, some companies remain concerned that the amendments are untested and subject to judicial interpretation.

Nevada and Texas have similarly been revising their corporate statutes to create a more business-friendly legal environment, including enhancing liability protections for directors, officers and controlling shareholders.⁹  Texas went so far as to allow certain public companies to include in their governing documents minimum ownership requirements for shareholders to bring derivative suits and to submit shareholder proposals (other than director nominations).  Additional legislation signed into law in late June would mandate a disclosure regime for proxy advisory firms that make recommendations on companies incorporated or headquartered in Texas that are based wholly or in part on non-financial factors, such as ESG, DEI or sustainability scores, or that are in opposition to the board’s recommendations.¹⁰  ISS and Glass Lewis are pursuing legal action to declare the measure unlawful and have it enjoined.¹¹  The law takes effect Sep. 1, 2025.

At least two Texas companies—Tesla and Southwest Airlines—have amended their bylaws to avail themselves of the revisions to the Texas Business Organizations Code (TBOC) by establishing a 3% ownership limit for shareholders to initiate or maintain a derivative proceeding and to provide for a jury trial waiver for internal equity claims. Tesla has scheduled its annual meeting for Nov. 6, 2025, and therefore could be a test case for the proxy advisor disclosure requirement.

Compensation Issues

Compensation Proposals

As in 2024, Chevedden sponsored over 60% of the compensation-related proposals, primarily on severance pay, clawback policies and executive stock retention requirements.  The latter generated the most traction with the highest level of average support (33.8%).  Average votes on the expansion of recoupment policies plunged to 6.7% from 17.7% last year because most of the targeted companies already had robust policies that in many cases went beyond what the proposal sought.

Overall, ISS’s support for shareholder compensation proposals was consistent with last year.  Glass Lewis backed a much larger proportion than in 2024:  44% versus 20%, excluding those from conservatives.  This was due to the absence of any gender/racial pay equity proposals on 2025 ballots, which Glass Lewis generally opposed last year.  The two pay gap proposals filed this season (at Amazon.com and Comcast) were withdrawn after being challenged as micromanagement.

Severance Pay

Since their peak in 2023, Chevedden’s severance pay proposals have decreased in volume due to the number of companies adopting policies requiring shareholder approval of future executive pay packages that provide cash severance payments exceeding 2.99x base salary and bonus.

This year, average votes rose to 23.6% from 15.5% in 2024 due to better targeting and a higher number supported by the proxy advisors.  ISS’s and Glass Lewis’s recommendations were largely aligned since they are both looking for a policy that guarantees shareholder approval of golden parachute-level payouts.

Delink Pay from ESG

For a second year, NLPC asked companies to consider eliminating ESG metrics from executive pay incentives.  In 2024, the emphasis was on decarbonization targets but largely shifted this year to discriminatory DEI goals.  The five DEI-focused proposals averaged 1.3% support and one was withdrawn at PepsiCo, which agreed to drop DEI incentives for its executives.  Three others were omitted as substantially implemented or materially false and misleading because the companies’ executive compensation plans no longer included DEI-related inducements.

According to Farient Advisors, the share of S&P 500 firms using DEI metrics in their executive compensation plans fell sharply this year to 22% from 52% in 2024.¹²  It noted, however, that some companies simply modified their language to avoid it looking like a DEI measure.  NLPC said that next year it plans to press companies on whether they actually dropped their DEI efforts.  It is also filing lawsuits to induce firms to decouple executive pay from DEI goals.

Key Compensation Proposals

Say on Pay

Buoyed by last year’s strong market performance, management SOP proposals posted solid results across all U.S. public companies for the first half of 2025.  While average support (90.5%) dipped slightly below last season’s average (91%), the failure rate (1.3%) and the proportion of companies receiving less than 70% support (6.1%) was identical.  Similarly, the percentage of companies receiving a negative ISS recommendation on SOP (12.3%) and the average support they received (72.6%) were nearly on par with the 2024 proxy season.

Of the 36 failures through June of this year, 25 were among Russell 3000 firms, including five in the S&P 500 index—Molina Healthcare, Simon Property Group, Otis Worldwide, Thermo Fisher Scientific and Warner Bros. Discovery.  Only nine cases (25%) of multi-year failures occurred, compared to over one-third of the pay rejections in the first half of 2024.

The reasons underpinning the failed votes also shifted.  According to Semler Brossy’s review, the most common investor concerns this year were special awards/mega-grants, shareholder outreach and disclosure, and non-performance-based equity.¹³  Last year’s failures were primarily attributed to pay-for-performance misalignment, the rigor of performance goals, and problematic pay practices.

Looking ahead, next year’s SOP votes will be impacted by Glass Lewis’s planned overhaul of its quantitative pay-for-performance (PFP) assessments.  This will include replacing the historical A-F letter grade system with a new 0-100 numerical scorecard system, with an associated concern level, and lengthening the evaluation period for key PFP tests from three to five years.

Longer term, the SEC is revisiting executive compensation disclosure requirements to assess whether the current rules are cost-effective for company compliance and provide material information for investors in plain English.  At a June roundtable discussion, participants cited several areas in need of reform, including  overly complex and lengthy Compensation Discussion and Analysis (CD&A) disclosures; the high compliance costs of pay-versus-performance (PvP), CEO pay ratio and clawback requirements; and the treatment of executive security expenses as perquisites.  The Commission is continuing to solicit public comments to inform its next steps.

SOP Voting Trends

Overview

2025 will be a transformational year marked by a more favorable business environment including the prospect of reduced regulation, lower taxes, reindustrialization, innovation and energy independence.  The flurry of White House activity will be unrelenting, warranting ongoing attention and adeptness by corporations.

In comparison, this season’s annual meetings are shaping up to be relatively calm as shareholder activists assess how they can adapt to this dynamic landscape and recalibrate their campaigns going forward.  Some of the trends emerging this spring include the following:

• A more corporate-friendly SEC: Under Republican leadership, the SEC will take a more measured
  approach to rulemaking and enforcement while focusing on its core mission of protecting investors, maintaining fair and efficient markets and facilitating capital formation.  Early on, the SEC undertook actions to deter shareholder activists and large asset managers from pressing companies to conform to environmental, social and governance (ESG) agendas.  These include revoking and replacing Biden-era guidance, which had made it difficult for companies to exclude Rule 14a-8 proposals that have a broad societal impact, and issuing clarifying guidance on shareholder engagements that may rise to the level of attempting to influence or control companies.  The SEC has also taken initial steps to unwind the 2024 climate disclosure rule.
• Less “noise” on proxy ballots:  To the relief of issuers and institutional investors suffering from “shareholder
  proposal fatigue,” the volume of filings to date (730) has subsided substantially after reaching its highest level last year (1,034) since 2015 (see Table 1).   Submissions of environmental and social (E&S) resolutions are down by nearly a third from last year’s peak as proponents awaited an expected course change by the incoming Trump administration and the GOP-led SEC.  Omissions are also running higher than last year, which stand at 18% of all filings compared to 12% in 2024.
• Governance measures stand out: Resolutions focused on widely accepted governance principles feature
  prominently in this season’s shareholder proposal lineup and will continue to prevail in the majority vote count (see Table 2).  E&S proposals are unlikely to rebound after losing steam in voting support since 2021 due to the “quantity over quality” approach of proponents.  Major asset managers could shift towards a more neutral stance, as did Vanguard last year when it refrained from supporting any E&S resolutions.
• Demise of diversity, equity and inclusion (DEI).  The Trump administration’s clamp-down on illegal DEI
  practices in the federal government and among federal contractors and the broader corporate community are accelerating the pace of company retreats from DEI commitments. Board diversity mandates are also disappearing after a federal court voided Nasdaq’s requirements in December.  As a result, DEI expectations are being purged from companies’ public communications and investor voting policies, which will frustrate pro-DEI activist campaigns that depend on robust disclosures.
• Pro- and anti-ESG faceoffs: Conservative-leaning investors are highly active again this proxy season and
  have already accounted for 39% of the first quarter shareholder proposal votes (see Table 3).  Despite the marginal support they generate, their campaigns will capture media attention, particularly at companies that must navigate competing resolutions on DEI, climate change and other E&S issues with diverging viewpoints.

This report further examines these and other key issues that will underpin the 2025 proxy season.

Table 1: Shareholder Proposal Trends

Table 2: Top Shareholder Proposal Filings: 2025 (as of April 7) – 2024 (full year)

Table 3: Early Votes (reported through April 7, 2025)

SEC Reforms 

Under GOP leadership, the SEC is pivoting away from former Chair Gary Gensler’s aggressive approach to rulemaking and enforcement and will prioritize reducing regulatory burdens, promoting capital formation and innovation, and creating a crypto-friendly regulatory framework.

In February, Acting SEC Chair Mark Uyeda began the process of dismantling the agency’s 2024 climate change disclosure rule, which was voluntarily stayed due to legal challenges over the rule’s validity.  In late March, the commissioners voted to end the SEC’s defense of the rule, signaling that the agency may eventually abandon it altogether. 

Other Gensler-era ESG rulemaking is not expected to survive either.  This includes proposed rules on human capital management and board diversity disclosure, which were delayed to October 2025 in the SEC’s fall 2024 Regulatory Flexibility Agenda.  

As described below, the SEC took immediate steps to offer relief to issuers from being pressured to adopt ESG measures.  In February, it issued new guidance that will facilitate the exclusion of shareholder proposals and will discourage large investors from being coercive when conducting engagements with companies.  Other reforms to the Rule 14a-8 process may be in store, including reexamining ownership thresholds, enhancing oversight of the proxy advisory firms and deterring robovoting practices.

No-Action Requests

The SEC’s Feb. 12 release of new interpretative guidance on the omission of Rule 14a-8 proposals has the potential to significantly disrupt the number of shareholder resolutions reaching ballots this season, particularly those dealing with E&S issues.¹

Staff Legal Bulletin (SLB) 14M largely reinstates pre-SLB 14L guidance, making it easier for companies to exclude shareholder resolutions on economic relevance and ordinary business grounds by applying a narrower, company-specific approach rather than looking to broad societal impacts.   Proposals that raise issues of social or ethical significance may be excludable if they do not have a sufficient nexus to the targeted company or if they relate to operations that account for less than 5% of total assets, net earnings and
gross sales.  

SLB 14M also reverts to previous staff guidance with expanded micromanagement exclusions, including proposals that are highly prescriptive, seek intricate detail or specific timeframes or methods for implementing complex policies, or deal with compensation available only to senior executives and/or directors.  

SLB 14M additionally calls attention to the fact that the SEC’s 2022 proposed amendments to the substantial implementation, duplication and resubmission bases for exclusion were never finalized.  The amendments would have narrowed these standards of omission by requiring that a company meet all of the proposal’s essential elements to be considered substantially implemented and for the proposal to address the same subject matter and seek the same objective by the same means in order to qualify for duplication or resubmission exclusion.  Henceforth, the staff will review these no-action requests under operative SEC rules and applicable staff guidance. 

The SEC is allowing companies to amend pending no-action requests or submit new ones, even if their filing deadlines have passed, if they wish to raise new legal arguments based on the updated guidance.  So far, 16 companies have done so, primarily to challenge various E&S proposals on ordinary business, micromanagement and economic relevance grounds.

Investor Engagements

New guidance on beneficial ownership reporting issued by the SEC in February will impact the timing and substance of outreach discussions between companies and their major investors by expanding on what constitutes an attempt to change or influence control of a company.²  

The revised Compliance and Disclosure Interpretations (CD&Is) provide clarity around situations when a large (greater than 5%) investor’s engagements would require more expansive disclosures on Schedule D, rather than the short-form Schedule G.  While a shareholder may discuss with management its views on a particular topic and how its views inform its voting decisions, it would be disqualified from reporting on Schedule G if the discussion constituted pressure tactics.  This would include if the shareholder explicitly or implicitly conditioned its support of the issuer’s director nominees at the next director election on the issuer abiding by the shareholder’s voting policy or adopting the shareholder’s recommendations regarding its governance provisions; compensation practices; or a social, environmental or political policy.

The new reporting requirements squarely take aim at a handful of institutional investors whose concentrated ownership of U.S. public companies gives them outsized influence over corporate decision making.  According to Free Float Analytics data cited by Reuters, in the fourth quarter of 2024, BlackRock and Vanguard filed 13G disclosures at 52% and 48%, respectively, of all U.S. public companies, followed by Dimensional Fund Advisors (9%), Fidelity Investments (9%) and State Street Global Advisors (SSGA) (7%).³

As a result, large investors who wish to retain their 13G status may be reluctant to share with portfolio companies their voting intentions or detailed perspectives on a given company.  SSGA, for example, overhauled its 2025 proxy voting and engagement policy and deleted all references as to when it will vote against directors and other management proposals.⁴ Issuers will therefore need to be attentive to the voting behavior of their major investors this year to stay apprised of issues that may trigger adverse votes.

E&S Issues

Shareholder proponents have substantially scaled back their submissions of E&S proposals this year, which have seen declining support since 2021 and posted only three majority votes in 2024.  So far, only about 429 E&S resolutions have been filed—a 30% decrease from last year’s 610.  The Interfaith Center on Corporate Responsibility (ICCR) also reported only 217 member filings for 2025, which is their lowest level since 2014.  As You Sow and Proxy Impact attribute the pull-back to proponents taking a “wait and see” approach in view of the change in presidential administration and expected policy shifts at the SEC.

E&S advocates have struggled to maintain the momentum their initiatives saw several years ago due in large part to complaints by major asset managers of the resolutions being overreaching, poorly targeted, lacking economic merit, or sufficiently implemented.  Last year, SSGA supported only 9% of E&S resolutions, BlackRock supported 4% and Vanguard supported none.  In contrast, 2021 support levels were 32% for SSGA, 40% for BlackRock and 26% for Vanguard.⁵ 

The number of E&S resolutions reaching ballots this season may also be down due to omissions.  So far, 15% of E&S proposals have been excluded, up from 8% last year, of which two-thirds were based on ordinary business arguments.  Another 54 no-action requests directed at E&S initiatives remained pending as of April 7.  Meanwhile, the rate of withdrawals, which are ongoing, is tracking about 11% behind last year’s level, including proposals that were reportedly filed but did not show up on ballots.

In addition to greenhouse gas (GHG)/climate transition plan resolutions, this year’s DEI-related proposals, which span both ends of the ideological spectrum, rank among the most popular shareholder resolution submissions.  Although some proposal formulations are less prescriptive, few topics among this year’s E&S lineup are likely to attract majority support.

DEI

DEI promises to be one of the most contentious issues this season for both advocates and detractors.  President Trump’s executive orders (EO) ending illegal DEI programs in the federal government and directing federal agencies to combat illegal discrimination and preferences in the private sector will set into motion the rapid decline of corporate DEI programs that violate civil rights laws.⁶

Corporate rollbacks of DEI initiatives, which were widely adopted in response to the #MeToo and Black Lives Matter movements, were initially sparked by the 2023 U.S. Supreme Court decision overturning affirmative action in higher education, prompting concerns over the risk of legal exposure.  The trend accelerated last year when social media influencer Robby Starbuck exposed consumer brand companies’ DEI programs, igniting a public backlash.

In keeping with the EOs, federal agencies are already deploying their enforcement powers to combat discriminatory DEI practices. The Federal Communications Commission (FCC) recently launched investigations into the current and past DEI policies of Comcast/NBC Universal and Walt Disney/ABC for potential violations of the FCC’s equal employment opportunity regulations. The Department of Justice (DOJ) and Equal Employment Opportunity Commission (EEOC) have also issued two technical assistance documents addressing their views on what workplace DEI practices may be unlawful.⁷ 

As a result, companies have been scrubbing mentions of DEI in their earnings calls, annual reports, and public communications and have disbanded DEI positions and departments, refocused employee training from diversity to business operations, and ended quotas for hiring, promotions, and the selection of suppliers.  However, it is unclear to what extent corporate DEI pullbacks are more optics than substance.  According to an April survey by the Society of Governance Professionals, only 37% of the responding member companies plan to adjust or have already adjusted their workforce-related DEI policies, programs and/or practices in response to the EOs.  Of these firms, over 80% are removing or rebranding DEI-related terminology from internal and external communications, while only 40% are scaling back diversity hiring and promotion goals or modifying DEI-linked pay metrics.

Workplace DEI Proposals

This year’s DEI-related proxy resolutions largely reflect pro- and anti-DEI activists’ reaction to the large-scale corporate retreat from DEI in 2024.  As You Sow is asking companies that rolled back their DEI commitments, including Ford Motor, Harley-Davidson and Tractor Supply, to disclose the research and analysis their boards undertook before changing their DEI policies and practices.   The AFL-CIO is similarly asking Best Buy, Lowe’s Companies and Tractor Supply to issue an LGBTQ+ non-discrimination report out of concern that their decision to stop reporting data to the Human Rights Campaign (HRC) reduces transparency around their non-discrimination policies.  Tractor Supply was able to block both resolutions on ordinary business or substantial implementation grounds, while Harley-Davidson successfully excluded the AFL-CIO resolution as micromanagement.

As You Sow has also rephrased its proposals asking companies to report on the effectiveness and outcomes of their DEI programs based on quantitative metrics for workforce hiring, promotion and retention by gender, race and ethnicity.  The revised language requests a report on the effectiveness of companies’ efforts to create a workplace where all employees can contribute to the company’s success.  

Conservative proponents are building on the momentum of 2024 by asking companies to report on the legal and reputational risks of maintaining their DEI programs or, in a more direct approach, to consider eliminating them altogether.  The National Center for Public Policy Research (NCPPR) is also calling on several companies to cease participating in the HRC’s Corporate Equality Index, which tracks employers’ commitment to LGBTQ+ equality practices.  A common concession among Starbuck’s corporate targets was ending their involvement with the HRC. The resolution received 1.5% at Walt Disney and is pending at CVS Health.

The National Legal and Policy Center (NLPC) is petitioning about 10 companies to revisit their executive incentive guidelines and consider eliminating discriminatory DEI goals.  Most of the targeted companies unsuccessfully argued to the SEC that they had substantially implemented the request, which simply asked them to review their incentive pay metrics—which they do annually anyway—rather than to make changes to them.  Several of the targets no longer include DEI goals in their executive pay measures which, according to WTW, have been losing ground at large-cap companies since 2021.⁸ 

Initial DEI Votes

The season’s first anti-DEI proposals, filed by NCPPR, asked Costco Wholesale to study and report on the financial risks associated with its DEI roles, policies and goals and for Apple to consider abolishing its DEI programs altogether.  Although the negligible levels of support (less than 2%) were regarded by the media and advocates as a referendum on the companies’ DEI programs, the votes essentially reflect the fact that the proxy advisors and large institutional investors almost never support resolutions from conservative proponents, irrespective of the topic.

Deere found itself in the crosshairs of pro- and anti-DEI proposals after paring back its DEI initiatives last year in response to Starbuck’s campaign.  Deere even stated in its proxy that because of the ideologically opposing perspectives of the proposals, it was unable to satisfactorily address the concerns of proponents with one set of views without creating concerns for those with an opposing viewpoint.

NLPC and As You Sow submitted similar resolutions at Deere seeking additional gender/racial workforce statistics to determine if the company engages in discriminatory versus merit-based hiring (NLPC) and to assess the effectiveness of the company’s DEI programs in creating a “meritocratic” workplace (As You Sow).  The NLPC proposal received 1.7%, while As You Sow withdrew its resolution before the annual meeting following dialogues with the company and after ISS and Glass Lewis had recommended against it.

The other notable vote at Deere was on a proposal by corporate gadfly John Chevedden calling for a third-party civil rights audit to analyze the bias and discrimination risks of the company’s policies, practices, products and services, including the adverse impacts of its recent rollback of its DEI commitments.  The resolution received 29.5%–well above last year’s 12.6% average support for similar proposals—and was backed by ISS and Glass Lewis.

Board Diversity

In addition to workplace DEI policies and programs, board diversity requirements are also disappearing.   Last December, the U.S. Court of Appeals for the Fifth Circuit invalidated Nasdaq’s 2021 board diversity rule which mandated that listed companies annually disclose the diversity of their directors and have at least one woman, racial minority or LBBTQ+ member on their boards or explain why they do not.  

Companies will also see relief this season from meeting board diversity mandates from proxy advisors and large institutional investors.  Because of the Trump administration’s heightened scrutiny of DEI practices, ISS suspended its consideration of board gender and racial/ethnic diversity factors when making voting recommendations on director elections at U.S. companies.  Glass Lewis will continue applying its policy but will flag its recommendations against directors for diversity-related reasons so its clients may vote differently.

Major institutional investors also removed board diversity considerations from their 2025 proxy voting policies, perhaps to avoid giving the appearance of promoting boardroom quotas.  BlackRock and State Street eliminated their numerical and percentage diversity targets for U.S. boards, while Vanguard, which had no explicit board diversity quotas, removed references to gender, racial and ethnicity diversity in favor of a broader range of “personal characteristics.”  Goldman Sachs Group similarly dropped its requirement that any company it takes public in the U.S. or Europe must have at least two diverse directors, including
one woman.

Investors who maintain quota-style voting policies may find them harder to apply if companies, such as those listed on Nasdaq, discontinue providing disclosure of board demographics.⁹ As a result, some investors will continue to press companies to voluntarily provide the information.  As part of its Boardroom Accountability Project 2.0, launched in 2017, the New York City Retirement Systems (NYCRS) is continuing to press companies to publish board matrices describing the skills, gender and race/ethnicity of individual directors.  Earlier this year, it reached agreements with Boyd Gaming and NextEra Energy and has shareholder proposals pending at Corpay and DraftKings Holdings.

Climate Change 

As with DEI, the Trump administration is deconstructing the climate change agenda.  As widely anticipated, President Trump issued a series of EOs to promote America’s energy independence and roll back Biden-era climate regulations, including withdrawing the U.S. from the Paris Agreement and other climate-related financial commitments. To advance these EOs, Environmental Protection Agency (EPA) Administrator Lee Zeldin subsequently announced 31 historic actions the agency will undertake to overhaul environmental regulations to unleash American energy, reduce the cost of living and spur economic growth. A follow-on EO, issued in early April, is directed at illegitimate state-level impediments to domestic energy production, including state laws purporting to address climate change or involving ESG initiatives, environmental justice, carbon or greenhouse gas (GHG) emissions, and funds to collect carbon penalties or taxes.¹⁰

In mid-March, U.S. Senate Banking Committee member Bill Hagerty (R-TN) introduced legislation–the “Prevent Regulatory Overreach from Turning Essential Companies into Targets” (PROTECT USA) Act of 2025—which would shield U.S. companies from regulatory encroachment by the European Union (EU), specifically the Corporate Sustainability Due Diligence Directive (CSDDD).¹¹ Adopted in May 2024, the CSDDD converts a range of international conventions into binding laws which would force American companies to adopt the EU’s net-zero carbon emissions target and other standards that exceed the requirements of U.S. law and impose severe financial penalties for violations.  Hagerty’s bill would prohibit U.S. entities in the agriculture, mining, energy, timber and manufacturing sectors from being forced to comply with the CSDDD or any foreign sustainability due diligence regulation and would block any adverse actions taken against such entities for action or inaction related to the regulation.

For its part, the EU released its Omnibus Simplification Package in February which would reduce the administrative burdens associated with the CSDDD, Corporate Sustainability Reporting Directive (CSRD), and EU Taxonomy Regulation.  The changes would exempt about 80% of companies from mandatory disclosures under the CSRD, simplify and reduce reporting and diligence requirements, and delay implementation deadlines.  The Commission said the revisions were needed to strengthen Europe’s competitiveness in view of the global demand for affordable and reliable energy.

United Nations-backed climate coalitions are also breaking apart.  In the first weeks of 2025, six of the largest U.S. banks pulled out of the Net Zero Banking Alliance (NZBA), while BlackRock—and more recently J.P. Morgan Asset Management–departed from the Net Zero Asset Managers Initiative (NZAM), which has since suspended its primary activities.  The defections follow years of probes by GOP lawmakers and state attorneys general (AGs) over potential anti-trust concerns arising from climate collaborations. Signatories of the organizations pledge to advance global net-zero goals through their investment, lending and policy advocacy activities.  NZAM members also agree to implement a stewardship and engagement strategy, with a clear escalation and voting policy, that is consistent with the ambition for all assets under management to achieve net-zero emissions by 2050 or sooner.¹² 

In view of the rapidly evolving regulatory landscape, climate-focused shareholder activists may be more compelled to pursue their agenda through private ordering.  This year, shareholder proposals addressing climate issues remain numerous, but it remains to be seen to what extent investor interest will hold up.  

In his 2025 annual letter investors, BlackRock Chair/CEO Larry Fink dispensed with mentions of DEI, ESG, climate change and sustainability.¹³ Instead, he continued last year’s theme of “energy pragmatism” in view of the surging global demand for electricity, fueled by artificial intelligence (AI) data centers, which cannot be met with renewables.  This year’s emphasis was on increasing energy production-particularly nuclear power–reducing burdensome regulatory and permitting requirements, and making investments in infrastructure projects through private markets more accessible to investors. 

GHG Emissions

Proponents of GHG emissions reduction proposals are gravitating towards less prescriptive requests after scoring only two majority votes in 2024 at Jack in the Box and Wingstop.  The sponsor of last year’s successful resolutions—The Accountability Board (TAB)—said that it deliberately made broadly worded requests that left discretion to companies as to what reduction goals they set and the scope of emissions they covered.

As a result, this year’s GHG resolutions may receive higher levels of support.  In many cases, the proposals simply ask companies how they plan to reduce their GHG emissions in alignment with the Paris goals or whether their current climate transition plans align with or can reasonably meet such goals.  Green Century Capital Management, which is focusing on Scope 3 emissions disclosure and target-setting across various industries, is also avoiding overly explicit language by, for example, asking companies how their supply chain emissions reduction targets align with their net-zero ambitions.

As You Sow and NYCRS are resuming their campaign at major banks to annually disclose their clean energy financing ratios, which compare their financing for low-carbon energy projects versus fossil fuel projects.  Last year, the proponents reached agreements with Citigroup, JPMorgan Chase and the Royal Bank of Canada to disclose the new climate metric, while the proposals voted averaged 25.9% support.

AI Data Centers

Along with individual investors, As You Sow has additionally introduced a new proposal at Amazon.com and Meta Platforms to explain how they will meet their climate change-related commitments in view of the growing energy demands from their build-out of AI data centers.  According to the U.S. Energy Information Administration, U.S. power consumption is expected to reach record levels in 2025 and 2026 due in large part to rising demand from data centers supporting AI and cryptocurrency.

In a related initiative, NorthStar Asset Management is raising concerns with the water demands of AI data centers and how companies are mitigating the impact on local communities of potential water supply disruptions and scarcity.  NorthStar reached an agreement with Adobe and has proposals pending at Digital Realty, Salesforce and Zoom Communications.

Climate Risk in Retirement Plans

For a fourth year, As You Sow is asking a handful of companies to assess and report on the actions they are taking to address climate change risk in their retirement plan options.  The proponent takes particular issue with target date funds offered by BlackRock, Fidelity and Vanguard, which are typically the most popular plan options but are heavily invested in high-carbon industries and companies that contribute to deforestation.  

Since being introduced in 2022, the resolutions have marshalled no more than 13% support and have been uniformly opposed by ISS and Glass Lewis.  Support for this year’s resolutions has been similarly weak—11.9% at QUALCOMM and 7.2x% at Walt Disney, with one still pending at Centene.

Net-Zero Pushback

Conservative proponents are continuing to rebuke net-zero policies for being economically destructive in view of the high global demand for oil and gas.  NLPC is asking several oil majors, including Chevron and ConocoPhillips, to remove all GHG emissions reduction targets covering company operations and energy products, while NCPPR has filed a repeat proposal at United Parcel Service to report on the risks arising from voluntary carbon-reduction goals, which received 8.4% support in 2024.

New Breeze is probing Duke Energy and several banks over their commitments and agreements involving net-zero goals.  Two of its targets—Bank of America and JPMorgan Chase—were successful in omitting the resolutions as substantially implemented after having dropped out of the NZBA in February.   In February, Wells Fargo became the first major U.S. bank to abandon its 2050 net-zero targets for financed emissions along with its sector-specific interim targets for 2030.  It said that achieving those goals was dependent on factors beyond its control, including public policy, consumer behavior and technology changes.

Environmental Protection 

Shareholder proposals on biodiversity and natural capital have surged in volume in recent years though support levels have fallen dramatically since 2021, in large part because companies have substantially addressed the requests.¹⁴ 

This year’s nature-related proposals include some new themes as well as repeat topics such as deforestation, plastic pollution and recycling, microfiber shedding, regenerative agriculture, and sourcing minerals from deep-sea mining.

• Avocado sourcing: As You Sow is asking several retailers what actions they are taking to prevent sourcing avocados from deforested land, particularly in Mexico.  Agreements were reached with Mission Produce and Target and the proposal remains pending at Kroger.
• Misleading labeling: Green Century Capital Management and The Last Beach Cleanup are urging food,
  beverage and consumer packaged goods companies to remove misleading recyclability claims from their plastic packaging labeling.
• Food waste: TAB is requesting restaurant and retail companies to measure and set targets for reducing the food waste they generate.  According to the Environmental Protection Agency, food accounts for almost one quarter of the waste sent to U.S. landfills.
• Plastic recycling policy review: New this year is a proposal by NLPC asking Colgate-Palmolive to
  reexamine its plastic production and packaging policies based on non-biased, objectively verified, scientifically accurate, and economically thorough research.  The proponent contends that single-use plastics have been unjustifiably demonized by environmental activists when plastic pollution is primarily the result of poor disposal practices, not production.

Workers’ Rights

Union pension plans have been less active this year in filing shareholder resolutions with about 53 submissions to date compared to 98 during 2024.  As in the past, a central focus is on workplace health and safety and freedom of association/collective bargaining rights.

• Worker health: The SOC Investment Group and NYCRS have sponsored a new proposal at four airlines to report on their efforts to mitigate extreme heat exposure throughout the companies’ operations that may impact worker health.
• Workplace violence: For a third year, various proponents including SOC are raising concerns about unsafe working conditions–particularly gun violence by customers—at restaurants and retail stores.  Last year, the proposal received 19.2% at Walmart and 30% at Chipotle Mexican Grill, where it has been refiled for 2025.  Both ISS and Glass Lewis have been supportive of this initiative.
• Non-interference policy:  In conjunction with their organizing efforts, labor proponents are asking about nine airline, automotive, broadcasting, food and banking companies to uphold the rights to freedom of association and collective bargaining in their operations as reflected in the International Labor Organization’s (ILO) Declaration on Fundamental Principles and Rights at Work.  Since this campaign began in 2022, average support has been declining each year from a high of 36.2% to 25.7% in 2024.The AFL-CIO is revisiting this issue at Warrior Met Coal where last year the proposal received its highest level of support (46.1%).  In response, the company has already commissioned an independent third-party assessment of the company’s respect for human rights, including freedom of association and collective bargaining rights.
• Anti-unionization: At Starbucks, NLPC countered the unionization drive by directing the board to study
  the human rights risks related labor organizing efforts, including how the company is protecting the rights of employees who do not wish to be represented by a union as well as negative impacts on shareholder value.  Although the company completed a similar assessment last year, it was produced as a result of a majority-backed shareholder proposal from pro-union activists and addressed only pro-bargaining rights perspectives.   The resolution received 1% support and was opposed by ISS and Glass Lewis.

Health impact-related proposals are down by about one third from last year due to the dramatic decline in abortion access resolutions, which peaked in 2023 following the U.S. Supreme Court decision to overturn Roe v. Wade.  Proponents have also intertwined their initiatives on the cost of prescription drugs with human rights standards and backed off their focus on anti-competitive practices such as patent exclusivities.

Meanwhile, concerns around food safety and product labeling will be reflected in Robert F. Kennedy Jr.’s reorganization of the Department of Health and Human Services (HHS) to prioritize reversing chronic disease by focusing on safe, wholesome food, clean water and the elimination of environmental toxins.

• Access to medicine: For a second year, faith-based organizations are taking a human rights approach
  to access to medicine and drug pricing at a half-dozen pharmaceutical companies.  The proposals call for a human rights due diligence process (HRDD) and human rights impact assessment (HRIA) to determine the extent drugmakers are increasing the access and affordability of their medicines.  A similar resolution last year received 10% at Eli Lilly and was withdrawn at Bristol-Myers Squibb and Pfizer.
• Access to healthcare: ICCR members pulled a much-touted measure at UnitedHealth Group to
  prepare a report on the public health costs and macroeconomic risks created by company practices that delay or deny access to healthcare.  The proposal was prompted by the public outrage over the exorbitant costs and restricted access to healthcare that ensued following the shooting of CEO Brian Thompson.  In view of the company’s no-action challenge, the proponents opted to withdraw the resolution so as not to jeopardize the chance to refile it next year.
• Nutrition reporting: In a new campaign initiated last fall by ShareAction, religious organizations are
  asking food and beverage manufacturers to report on the healthiness of their products using internationally recognized Nutrient Profiling Models (NPMs).  The resolution was withdrawn at Kraft Heinz and omitted at Mondelez International as micromanagement.
• Non-sugar sweeteners: After a longstanding campaign on the role of sugar in disease causation and obesity, particularly among children, religious orders switched their focus last year to the potential health harms of non-sugar sweeteners in soft drinks.  The proposal has been refiled at Coca-Cola and PepsiCo, where it received 10.7% and 11.5%, respectively, in 2024.

Political Activities

Notwithstanding the release of SLB 14M, companies have been more successful in recent years in omitting shareholder proposals on ordinary business and micromanagement grounds.  Lobbying disclosure resolutions became an early casualty of the 2025 proxy season after Air Products and Chemicals successfully argued for micromanagement exclusion because the supporting statement narrowly focused on the company’s association with specific organizations, such as the National Association of Manufacturers (NAM) and the American Legislative Exchange Council (ALEC).

According to the American Federation of State, County and Municipal Employees (AFSCME), a long-time sponsor of corporate lobbying proposals, there were eight previous determinations by the SEC staff between 2011 and 2020 that the proposals focused primarily on companies’ general political activities and did not constitute micromanagement.

Out of over three dozen lobbying proposals filed for 2025—mostly by Chevedden—about two dozen companies are seeking no-action relief on micromanagement grounds, in some cases also noting the highly prescriptive and detailed nature of the report being sought.  So far, 15 requests have been granted, two remain pending, and eight were withdrawn by the proponents after being challenged.  

As a result, the proponents are crafting revised versions of their proposals which instead focus on what actions the company has taken when the lobbying efforts of the trade associations and social welfare groups in which it is a member contradict the company’s public position.

Conservative Initiatives

Conservative-oriented proponents have cut back their submissions this year, which stand at about
100 proposals, down from a high of 120 in 2024. However, their share of all 2025 filings has risen to 14% from
11% in 2024, and this year they account for 21% of all E&S filings, compared to 18% in 2024.  Although their initiatives typically draw negligible levels of support, many of their longstanding issues—particularly their opposition to DEI and ESG—are being addressed by the Trump administration and GOP Congressional lawmakers and state officials.

This year, several new right-leaning advocacy groups have joined in on issues such as censorship, politicized debanking, religious discrimination in corporate charitable giving, and data privacy in AI systems.  These include the Heritage Foundation, GuideStone Capital Management, the Catholic Diocese of Fort Worth, Investing with Purpose Capital, and the Oklahoma Tobacco Settlement Fund.

In an unusual move, Bristol-Myers Squibb reached an agreement with NCPPR to include two of its resolutions on its 2025 ballot.  One calls for the cessation of the company’s DEI efforts and the second requests the establishment of a board committee to oversee and review the impact on the company’s financial sustainability of its policy positions, advocacy, partnerships and charitable giving on social and political matters.

AI and Data Protection 

NLPC is targeting Big Tech companies with proposals on how they are safeguarding user data from potential unethical or improper usage in the development and training of their AI products.  The massive amounts of training data needed by AI systems are often sourced from personal information, copyrighted material and proprietary business data, in some cases through third parties such as OpenAI, which has faced multiple allegations of unethical data collection practices without data owners’ consent.

The proposal was first introduced at Microsoft last fall where it received 36.2% support—one of the highest levels attained on a social proposal sponsored by a conservative investor.  It also received the rare backing of both proxy advisors.  At Apple’s February annual meeting, it received 11.6% and was endorsed by Glass Lewis but opposed by ISS.  Additional resolutions are pending at Alphabet, Amazon.com and Meta Platforms.

Censorship

Conservative investors’ 2025 censorship proposals take aim at potential risks arising from discrimination against advertising buyers and sellers based on their political or religious views.

A particular concern has been companies’ affiliation with the Global Alliance for Responsible Media
(GARM), which was formed by the World Federation of Advertisers (WFA) in 2019 to help advertisers avoid supporting harmful or illegal content in digital media that could damage their brands.  GARM was disbanded in 2024 following a lawsuit by X and a House Judiciary Committee investigation over its “cartel-like behavior” to demonetize platforms, podcasts, news outlets and other content deemed disfavored by GARM and its members.¹⁵ 

Bowyer Research, which is the primary sponsor of the proposals, contends that many of the advertising agencies, corporations and trade associations that were GARM members continue to maintain similar censorship practices.  The measure received 1% at Walt Disney and is pending at six other companies.  The proponents reached agreements with Johnson & Johnson, Mastercard and PepsiCo, which have committed to independent decision-making in their advertising.

Bitcoin Diversification Strategy 

President Trump’s EOs aimed at making the U.S. the “crypto capital of the world” marks a dramatic shift from the Biden administration’s often hostile approach to digital assets, particularly regarding SEC enforcement actions.¹⁶ In addition to developing a federal regulatory framework for crypto assets, the Trump administration is considering the creation of a national digital asset stockpile.  About two dozen states are also advancing legislation for strategic Bitcoin reserves.

This forward-looking stance on digital technology could give a lift to proposals filed by NCPPR asking several companies, including Dell Technologies, Meta Platforms and Salesforce, to conduct an assessment to determine if adding Bitcoin to the company’s treasury would be in the long-term interests of shareholders.   NCPPR’s initial foray into this topic received only 0.5% support at Microsoft last fall and was opposed by the proxy advisory firms.

Charitable Contributions 

Conservative investors have reformulated their charitable giving proposals, which in the past asked for a list of the recipients of corporate charitable contributions over a certain amount ($5,000 or $10,000).  This year’s versions are tied to religious discrimination.

• Employee philanthropic freedom: Inspire Investing, Investing with Purpose Capital and the Catholic Diocese of Forth Worth are asking a number of companies to issue a report evaluating how excluding religious charities from the company’s employer-gift match program impacts the risks of religious discrimination against employees.  The resolution received 1.9% at Apple and was withdrawn at Charles Schwab due to ongoing dialogues.  Other targets, including American Express, BlackRock and Wells Fargo, were able to omit the proposal for containing false or misleading statements.
• Discrimination in charitable giving:  Bowyer Research and the Oklahoma Tobacco Settlement
  Endowment Fund are asking several firms to assess how their charitable contributions and partnerships—particularly their sponsorship of the HRC—impact their risks related to religious discrimination against individuals based on their speech and religious exercise.  The proposal received 1.3% at Deere and 0.8% at Starbucks and is pending at lululemon athletica. 

Governance Issues

As in 2024, governance proposals are poised to outperform other categories of shareholder resolutions and will likely dominate the majority vote count.  Through March, four proposals already received majority support.  These included a board declassification proposal at Agilent Technologies, where the board made no recommendation on the measure, and two proposals to replace supermajority voting with a simple majority vote at Post Holdings and Hologic, where the board supported the measure.  A proposal to reduce the eligibility threshold for calling special meetings from 25% to 10% also garnered a majority vote at Sanmina.  

Last year’s successful campaigns are having an impact as well with a record number of companies (80 to date) proposing to retract their supermajority voting provisions, in many cases proactively rather than in response to a new shareholder proposal or a past vote.

Chevedden continues to be the most prolific sponsor of governance resolutions, as well those on compensation matters, such as severance pay, clawbacks and the retention of equity awards.  However, at least 17 of his resolutions have been excluded this year for procedural deficiencies, including at five companies where he neglected to include the proposal in his submission. 

TAB, which focuses on the food industry, is also expanding more into the governance arena this year.  So far, it has filed over a dozen resolutions on special meeting rights, independent board chairs, board independence, dual-class stock and the repeal of supermajority voting.  

Individual investor Chris Mueller has reemerged for a second year with over three dozen filings that largely center around concerns related to direct stock purchase plans.  These include offering ComputerShare’s QuickCert “print on demand” stock certificates, educating shareholders on how they can protect their securities against abusive short-sellers (such as the 2021 GameStop short squeeze), and demanding additional disclosures from the transfer agent on arbitrage exposure enabled through recurring direct stock plan purchases.

In all cases last year, Mueller’s submissions suffered from procedural defects and were omitted or withdrawn following company challenges.  So far, his 2025 resolutions are succumbing to the same fate and unlikely to reach ballots.

Special Meeting Improvement  

This year, Chevedden is presenting two versions of his resolutions to enhance shareholders’ special meeting rights: to adopt or reduce the stock ownership threshold to 10% or to simply drop any one-year holding period.  

The latter style of proposal was last introduced at four companies in 2023 and received only 11.6% in average support.   ISS opposed all of the resolutions, while Glass Lewis supported those where the company’s ownership requirement was above Glass Lewis’s preferred level of 10-15%.  According to DMI data, of the S&P 500 firms that allow shareholders to call special meetings (74%), 15% attach a one-year holding period to their ownership provision.

Director Resignation Policies

Early votes continue to show only modest support for proposals filed by the United Brotherhood of Carpenters calling for more rigorous director resignation policies, despite some tweaks from last year.  This year’s version requires that if a director fails his election for two consecutive years, his second tendered resignation would be automatically effective 90 days (rather than 30 days) after the vote is certified and that the policy be contained in the governance guidelines (rather than the bylaws).

Eight resolutions came to a vote in January and averaged 21.8% support—up from 17.6% for the eight voted in 2024—with the highest vote ever recorded at Sally Beauty Holdings (38.8%).   ISS has continued to oppose the proposals while Glass Lewis supports them.

Proposals in the pipeline for later meetings include an updated version at Supernus Pharmaceuticals which asks the company to adopt a governance guideline whereby after an initial failed vote, the director’s tendered resignation would be effective 90 days after the vote is certified.  The company is trying to omit the resolution as materially false and misleading because it has a plurality, rather than a majority, voting standard.  

Dual-Class Vote Reporting 

Faith-based organizations are filing a relatively new proposal at dual-class stock companies to report their vote results according to each class of stock in order to better monitor their responsiveness to the votes of non-insider shareholders.  The resolution received 13.1% at Tyson Foods and is pending at Meta Platforms, where last year’s proposal received 17.1% support.  ISS and Glass Lewis have been supportive of this initiative.  Interestingly, the resolutions are scoring lower votes than proposals calling for a recapitalization plan so that each share carries one vote, which garnered 26.3% at Meta Platforms in 2024 and 20% at Tyson Foods in 2020.

Reincorporations 

2025 was expected to be the year of “DExit” after a series of Delaware court rulings—the most prominent being the recission of Elon Musk’s $55 billion pay package—have called into question the state law’s longstanding predictability.

According to Bloomberg data, out of 40 proposed reincorporations between 2021 and mid-August, 2024, 15 companies sought to redomicile from Delaware to another state, primarily Nevada and Texas, which are vying to become legitimate alternatives^.17 Citing the increasingly litigious environment for companies with controlling shareholders, Dropbox, Meta Platforms, Pershing Square Capital Management, Simon Property Group, Trump Media & Technology Group and Walmart are considering or have made plans to leave the state.¹⁸  

To stave off an exodus, in late March amendments to the Delaware General Corporation Law (DGCL) were enacted that offer a process for boards to protect directors, officers and controlling shareholders from litigation over alleged conflicts of interest.¹⁹  These include providing safe harbors for conflict transactions, establishing a presumption of director independence based on national stock exchange standards, narrowing shareholder access to books and records, and defining a controller as owning at least a majority of the voting stock or one-third of the voting stock combined with managerial control over the affairs of the corporation.

The legislation has drawn sharp criticism from investor and public interest groups that it will reduce corporate insider accountability and lower safeguards for minority shareholders.  However, advocates contend that the amendments will restore balance, clarity and certain to Delaware law.

On March 4, proxy advisor Glass Lewis announced that was implementing a new bifurcated approach to its proxy voting advice on diversity-related voting matters at U.S. public companies. It had advised clients on Feb. 18 that it was reevaluating its policies in view of the Trump administration’s January executive orders banning illegal diversity, equity and inclusion (DEI) policies in the federal government and the Attorney General’s directive to the Department of Justice to investigate, eliminate and penalize private companies that have illegal discrimination and preferences, including DEI.

Glass Lewis will continue to apply its 2025 U.S. benchmark and thematic guidelines on board elections and DEI-related shareholder proposals as is.¹ However, beginning March 10, where it recommends against directors for any diversity-related reasons, its proxy papers will carry a “For You Attention” (FYA) flag pointing clients to a supporting rationale that they can leverage if their preference is to vote differently from Glass Lewis’s recommendation.

Glass Lewis’s U.S. benchmark policy on board diversity is as follows:

• For Russell 3000 firms, it generally recommends against the nominating committee chair if the board is not at least 30% gender diverse and against the full nominating committee if there are no gender diverse directors.
• For non-Russell 3000 firms, it generally recommends against the nominating committee chair if there are no gender diverse directors.
• For Russell 1000 companies, it generally recommends against the nominating committee chair if the board has no directors from an underrepresented community. It will additionally oppose the nominating/ governance committee chair if there is no disclosure of individual or aggregate racial/ethnic minority board demographic information.

Glass Lewis believes its updated approach will allow it to support the varied diversity-related voting preferences of its institutional clients without the disruption that a hard policy change would pose in the middle of proxy season. The announcement follows Institutional Shareholder Services’ (ISS) decision to suspend its consideration of gender and racial/ethnic diversity factors in its voting recommendations on director elections beginning with its reports issued on or after Feb. 25.

¹ See Glass Lewis’s 2025 U.S. benchmark policies at https://resources.glasslewis.com/hubfs/2025%20Guidelines/2025%20US%20Benchmark%20Policy%20Guidelines.pdf and https://resources.glasslewis.com/hubfs/2025%20Guidelines/2025%20Shareholder%20Proposals%20&%20ESG%20Benchmark%20Policy%20Guidelines.pdf.