Julie Gorte: Linking Investor Engagement with Financial Value, July 2019.
/Julie Gorte, Impax Asset Management
Some observers tend to see vote totals on shareholder proposals as binary — either they pass or they don’t. But it is useful to understand the nuances, too. In accounting, a shareholder holding at least 20 percent of a company’s shares has a significant or active interest, and that is something that can influence management decisions. That provides a different lens through which to see the 30 percent average support for shareholder proposals than a simple pass/no pass view. It’s also an indicator that it’s not just a bunch of frustrated political activists interested in these proposals; it’s an indication that a significant proportion of a company’s investors see them as relevant to the company’s financial performance.
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