Institutional investors were more aggressive with governance activism in the 2017 proxy season, according to a report from PricewaterhouseCoopers and Broadridge Financial Solutions.
Based on the analysis of 3,379 shareholder meetings held in the first half of 2017, the report said climate change proposals specifically gained momentum, with money managers like BlackRock (BLK) publicly supporting proposals at several companies after not having done so previously. Overall, seven climate change proposals received at least 40% shareholder support this season, compared with none in the 2016 proxy season.
Institutional shareholders voted 66% of their shares in favor of those proposals, compared to 13% of retail shares.
Across all categories, institutional shareholders generally were two to three times more supportive of proposals than retail shareholders. For example, the report cited institutional shareholders voted 32% of shares in favor of environmental proposals compared with 10% of retail shareholders.
For proposals related to board diversity, 31% of institutional shareholders voted in support, while only 14% of retail shareholder did so. The average support for the nine shareholder proposals on board diversity was 27% this proxy season, compared with 23% for eight proposals a year earlier.
While overall shareholder proposals that went to a vote decreased in 2017 — to 430 from 506 — 76% of those votes took place at S&P 500 companies compared to 72% the previous year.