Show that you understand the current state of research on your topic.
The length of a research proposal can vary quite a bit. A bachelor’s or master’s thesis proposal can be just a few pages, while proposals for PhD dissertations or research funding are usually much longer and more detailed. Your supervisor can help you determine the best length for your work.
One trick to get started is to think of your proposal’s structure as a shorter version of your thesis or dissertation , only without the results , conclusion and discussion sections.
Download our research proposal template
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See an example
Writing a research proposal can be quite challenging, but a good starting point could be to look at some examples. We’ve included a few for you below.
Like your dissertation or thesis, the proposal will usually have a title page that includes:
The first part of your proposal is the initial pitch for your project. Make sure it succinctly explains what you want to do and why.
Your introduction should:
To guide your introduction , include information about:
As you get started, it’s important to demonstrate that you’re familiar with the most important research on your topic. A strong literature review shows your reader that your project has a solid foundation in existing knowledge or theory. It also shows that you’re not simply repeating what other people have already done or said, but rather using existing research as a jumping-off point for your own.
In this section, share exactly how your project will contribute to ongoing conversations in the field by:
Following the literature review, restate your main objectives . This brings the focus back to your own project. Next, your research design or methodology section will describe your overall approach, and the practical steps you will take to answer your research questions.
? or ? , , or research design? | |
, )? ? | |
, , , )? | |
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To finish your proposal on a strong note, explore the potential implications of your research for your field. Emphasize again what you aim to contribute and why it matters.
For example, your results might have implications for:
Last but not least, your research proposal must include correct citations for every source you have used, compiled in a reference list . To create citations quickly and easily, you can use our free APA citation generator .
Some institutions or funders require a detailed timeline of the project, asking you to forecast what you will do at each stage and how long it may take. While not always required, be sure to check the requirements of your project.
Here’s an example schedule to help you get started. You can also download a template at the button below.
Download our research schedule template
Research phase | Objectives | Deadline |
---|---|---|
1. Background research and literature review | 20th January | |
2. Research design planning | and data analysis methods | 13th February |
3. Data collection and preparation | with selected participants and code interviews | 24th March |
4. Data analysis | of interview transcripts | 22nd April |
5. Writing | 17th June | |
6. Revision | final work | 28th July |
If you are applying for research funding, chances are you will have to include a detailed budget. This shows your estimates of how much each part of your project will cost.
Make sure to check what type of costs the funding body will agree to cover. For each item, include:
To determine your budget, think about:
If you want to know more about the research process , methodology , research bias , or statistics , make sure to check out some of our other articles with explanations and examples.
Methodology
Statistics
Research bias
Once you’ve decided on your research objectives , you need to explain them in your paper, at the end of your problem statement .
Keep your research objectives clear and concise, and use appropriate verbs to accurately convey the work that you will carry out for each one.
I will compare …
A research aim is a broad statement indicating the general purpose of your research project. It should appear in your introduction at the end of your problem statement , before your research objectives.
Research objectives are more specific than your research aim. They indicate the specific ways you’ll address the overarching aim.
A PhD, which is short for philosophiae doctor (doctor of philosophy in Latin), is the highest university degree that can be obtained. In a PhD, students spend 3–5 years writing a dissertation , which aims to make a significant, original contribution to current knowledge.
A PhD is intended to prepare students for a career as a researcher, whether that be in academia, the public sector, or the private sector.
A master’s is a 1- or 2-year graduate degree that can prepare you for a variety of careers.
All master’s involve graduate-level coursework. Some are research-intensive and intend to prepare students for further study in a PhD; these usually require their students to write a master’s thesis . Others focus on professional training for a specific career.
Critical thinking refers to the ability to evaluate information and to be aware of biases or assumptions, including your own.
Like information literacy , it involves evaluating arguments, identifying and solving problems in an objective and systematic way, and clearly communicating your ideas.
The best way to remember the difference between a research plan and a research proposal is that they have fundamentally different audiences. A research plan helps you, the researcher, organize your thoughts. On the other hand, a dissertation proposal or research proposal aims to convince others (e.g., a supervisor, a funding body, or a dissertation committee) that your research topic is relevant and worthy of being conducted.
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EREF is one of the largest sources of private research funding in North America related to sustainable materials management. Our grants program has provided millions of dollars in funding to cutting edge research institutions to help address the many challenges that exist.
The process for grant consideration involves the submission of a 2-page pre-proposal aligned with the areas noted in the RFP. Pre-proposals are reviewed by staff and EREF’s Research Council, a committee of subject matter experts. Successful pre-proposals are invited to submit full proposals, which are reviewed by both academic peers and non-academic subject matter experts. The Research Council uses these reviews and discusses the relevancy of the proposed research topics to create a recommendation for funding. This recommendation is then received by EREF’s Board of Directors for final award consideration.
The Priorities are of equal importance, and proposals will not be rated more strongly for one priority area over another. Some subtopics within each priority area also have specific topics of interest identified proposals that are aligned with these subtopics are of particular interest to EREF. Proposals must meet EREF’s definition of solid waste as noted at the end of this RFP. Submitted pre-proposals must relate to sustainable solid waste management practices and at least one of the following Priority areas.
Questions: [email protected]
Click to view and search Reports from our previous Grantees since 2009. To inquire about reports prior to that, please email us at [email protected].
Please read through the criteria below thoroughly. Submissions not adhering to these guidelines will not be reviewed.
EREF has two deadlines per year for pre-proposals:
Pre-proposals will be accepted starting from 15 days prior to the deadline date and up to the close of business (5:00 p.m. eastern time) on the deadline date. Proposals must be received during this window to be considered. If any of the above dates fall on a weekend, then the deadline will be the Monday following the due date.
All pre-proposals must be submitted through an online application found here .
Mailed hard copies and e-mail submissions will not be accepted.
NOTE: You are being directed to a 3rd party platform called InfoReady. If you have not submitted through InfoReady before, you will need to create an account separate from the EREF website.
There are a number of topics that may require approval before a pre-proposal will be considered. Investigators who would like to propose a research topic where the primary objectives relate to the areas listed below should contact EREF to discuss the topic prior to submitting a pre-proposal. To do this, please email a description of the proposed research that is 1-page or less to [email protected] that requests review of the concept. This request should be made 2 weeks or more in advance of any pre-proposal deadline. If necessary, or upon request, the concept can be discussed via phone as well.
List of Topics Requiring Approval
Pre-proposals must adhere to the pre-proposal template and be in English. Proposals should be between 1 to 2 pages in length in 12-point Times New Roman font. The spacing on each page shall be between 1.15 and 1.5 lines. All pre-proposals MUST use the template provided. Pre-proposals that do not use the template will not be reviewed.
File Attachment and Naming| Pre-proposals must be attached as a single Microsoft Word® or in portable document format (PDF) and named as follows: PI Last Name_AbbreviatedInstitutionName_MonthSubmittedYearSubmitted_preproposal
Example Dr. John Smith from Arizona State submits a pre-proposal in August 2016 then the file submitted would be named: Smith_ASU_0816_preproposal.doc (or .pdf)
Files submitted that are incorrectly formatted will not be accepted.
Multiple Files Submittal of multiple files will not be accepted.
Cover Letters Cover letters for pre-proposal submissions are not required.
All pre-proposals shall be submitted through an online application found here . Mailed hard copies and email submissions will not be accepted. NOTE: You are being directed to a 3rd party platform called InfoReady. If you have not submitted through InfoReady before, you will need to create an account separate from the EREF website.
Pre-proposals are now REQUIRED prior to submitting a full proposal using the pre-proposal template . All pre-proposals must adhere to the criteria noted and be submitted by the established deadlines. Pre-proposals submitted in response to this RFP that do not fit within the topic areas noted will not be reviewed.
Upon submission, pre-proposals will be examined by a selection committee and successful pre-proposals will be invited to submit a full proposal for consideration. Full proposals will then be subjected to EREF’s review process.
The following information summarizes EREF’s review process from pre-proposal submittal to final award.
Tier 1: Pre-proposal Screening Pre-proposals submitted successfully in accordance with EREF guidelines go through two stages of review:
Tier 2: Full Proposal Screening Full proposals are subjected to the following review process where multiple reviewers are assigned to each proposal and consist of industry experts and academic personnel who have particular/specific expertise in the research topic. All reviews are compiled and the proposal receives a technical review score ranging from 0% to 100%. Proposals with technical review scores of less than 65% are dropped from further consideration.
Tier 3: Research Council Rating Remaining proposals are rated by the Research Council during one of its in person meetings. The Research Council is a volunteer body of industry experts who have broad expertise in the field. The Council rating is based on various factors, including but not limited to: relevancy to industry needs, perceived impact, applicability, need to subsequent/follow-up work, etc.
The Council then considers the technical review scores and Council rating scores together and develops short list of proposals that are recommended for funding.
Tier 4: Funding Allocation by Board of Directors The EREF Board of Directors reviews the Research Council’s recommendations and approves funding for all or a selected number of proposals. It should be noted that all proposals recommended by the Council to the Board of Directors are considered worth funding. However, various factors are considered in this process (e.g. available funds, ability to fund multiple projects, strategic direction, etc.) and thus there are times when not all recommended projects are funded.
Projects and research previously funded by the Foundation can be viewed on its website at erefdn.org . Previously awarded grants have ranged from $15,000 to over $500,000 with the average grant amount in recent years being $160,000. Typical project durations are about 2 years. It should be noted that proposed research in excess of $300,000 or longer than 3 years should contain sufficient details that justify the need for the higher than average amount requested and longer project duration.
Non-U.S. Institutions There are no restrictions in regards to geographic location. Any U.S. or non-U.S. institutions are eligible to apply.
Non-Academic Institutions Proposals will be accepted from non-academic institutions provided the principal investigators are qualified to conduct the research.
Multiple Institutions Submissions may include multiple institutions.
Who Can Serve as a Principal Investigator Principal investigators (PI) must be qualified to do the work proposed and should be experts in the subject matter referenced in the pre-proposal/proposal. Typically this would include full-time faculty at academic institutions, post-doctoral employees, and principals or senior personnel at non-academic institutions. Graduate students are not eligible to be principal investigators. However, graduate students are encouraged to consider applying to EREF’s scholarship program (see the EREF website for details).
Multiple Pre-Proposal Submissions Pre-Proposal submissions are limited to two (2) submissions per principal investigator during a particular submission period. Beyond this, the PI cannot be listed as a PI or co-PI on other submissions that round, but may be listed as a supporting investigator on other submissions.
Repeat Submittals Pre-proposals that did not receive an invitation to submit a full proposal may re-submit a revised version of the original pre-proposal once, and thereafter, approval must be obtained by EREF beforehand. In the event a research topic is very closely related to a prior submittal by the same entity, EREF staff will make any determinations regarding whether or not a submitted proposal constitutes a re-submittal.
Overhead Costs EREF will not pay indirect or overhead costs in excess of 25% of direct costs. For non-academic institutions, the definition of overhead can vary. However, typically this refers to payment that denotes a time and materials rate multiplier of 1.25. Please contact EREF if your firm does not fit this model to discuss defining an appropriate overhead definition.
Cost Sharing Cost sharing is encouraged, but is not required. For clarity, any cost sharing should not be listed in in the “Amount Requested” line of the pre-proposal form. Only the amount requested from EREF should be listed. If cost sharing will be a part of the proposal, the amount of the cost share and where it comes from can be noted in the full proposal if one is requested.
In Kind Services and Additional External Funding Because the amount of funding for research is limited, EREF encourages submitting parties to form partnerships with other funding sources (real-dollars or in-kind services). Parties should identify the sources and amounts of external funding in their submissions. It is preferred that real dollars from external sources be managed through EREF rather than going to the research institution directly. Note that in such instances this does not reduce the amount of these funds that go to the research institution.
Including Educational Objectives/Efforts in Research Proposals Pre-proposals do not need to contain specific or direct educational objectives. There is no special consideration given to proposals when such objectives are included. If the proposed research includes substantial efforts related to education, these may be deemed an educational project. For information regarding educational projects, see below.
Educational Projects Grants are typically not provided to support the development of educational projects. However, collaborations or partnerships with entities seeking to develop educational materials for sustainable solid waste management, including conferences or events, which advance the Foundation’s educational mission may be considered. It is preferred that this be done with EREF being a primary stakeholder/partner in the event and that utilizes a revenue model that covers expenses for the project. To be considered, proposed concepts should be discussed with EREF and should include: (i) a description of how the concept is unique or provides a value-add to the solid waste field, (ii) how EREF might be included as a partner/stakeholder, and (iii) how it relates to EREFs mission.
Additional Limitations It is EREF’s policy that all results from funded projects are made publicly available and are without bias. Thus, EREF will typically avoid funding proposals prepared with the following aims:
Pre-proposal reviews take up to 12 weeks from the time of submission.
Proposal reviews take up to 4 months from the time of submission.
Place 1 in the file name in the first pre-proposal with a short project identifier and a 2 in the 2nd file name with a project identifier.
References do not need to be cited but “References can be provided upon request” can be noted.
Once you receive a notification that your pre-proposal has been invited for a full-proposal submission, you will be given on average 30-40 calendar days from the day you are notified. This time frame will be updated at EREF’s discretion.
To allow sufficient time for response, all questions must be received 48 hours before pre-proposal submissions begin. Please submit questions to [email protected] .
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Heidi Jane Smith
The course helps students understand the changing characteristics and functions of cities across time and space, with a focus on urban phenomena in developing countries. Using case studies from the world's major developing regions, the course explores economic, social, political, environmental and cultural forces at different scales of governance. Based on a thorough review of theoretical foundations, students investigate challenges that emerge in rapidly growing cities, ranging from income inequality and socioeconomic exclusion to sprawling and underserviced landscapes, political mobilization and urban governance, environmental and health-related issues, as well as interpersonal violence at different levels of organization and intensity. Students are required to prepare a substantial amount of literature for each session in order to allow for vivid class discussion. Each session begins with a student presentation, and all students present twice during the course of the trimester. Afterwards, short lectures alternate with guided discussions in plenary and smaller groups. There are no regular homework assignments but students have to complete a take-home mid-term exam testing their understanding of key concepts and their ability to apply their knowledge effectively. A case study at the end of the course cycle pulls together different theories and experiences and trains students in applied urban analysis. The final deliverable, an analytical paper prompts them to develop their own research questions as well as a suitable methodology to address it.
Maurizio TIEPOLO
Jayprakash Chadchan
Urbanization is a centuries old phenomenon. Despite numerous attempts to capture various aspects of urbanization and its impact on human habitat, the thirst for knowledge of this complex process still remains a great importance among many quarters of human inquiry. Since the second half of the twentieth century, urbanization has become an alarming social process in the world, particularly in developing countries. While continuing the urbanization process in the already more urbanized developed world, three fourths of the total population lives in urban areas in Latin America and the Caribbean; one third of the population of Africa and Asia lives in urban areas. Urbanization is the most critical process and form of global transformation, which has mirrored uneven development between regions, within regions, and within countries. The developing world presents a more precarious condition with exponential population growth unparallel to their economic and social progress. At the turn of...
SAMBRIDHI, a Development Journal of Center for Development Studies
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Human settlements evolved from primitive villages to towns, then to the classic cities and shaped by war, trade, religion, politics and the natural environment. Cities are probably the most complex things that human have ever created. They are the wellsprings of culture, technology, wealth and power. People have a love-hate relationship with cities. Like natural ecosystems, our cities have largely been the result of conflict and adaptation and powerful forces beyond our control. Cities have been centers of democracy, creativity and economic activity from the earliest times. The density and agglomeration are essential for productivity and growth. For the first time in history more than half the world’s people live in cities. Nearly two billion new urban residents are expected in the next decade and the urban population of South Asia is likely to be doubled. This raises questions about proper management of urban affairs, and urbanization, urban planning and development in particular. So, “urbanization” becomes an issue to tackle. For many, the question is not how to hold urbanization—it is how to prepare for it, reaping the benefits of economic growth associated with urbanization while reducing congestion, crime, informality and slums. Urbanization, if properly managed through the proper planning and designing of denser, more compact cities that increase businesses and industries, improves urban conditions, as demonstrated by many successful programs around the world. Urban planning is a relatively recent discipline to deal with a vast and complex array of urban problems, which we still don't completely understand. Throughout history, we haven't been very successful for better management of urbanization and planning our cities. Therefore, this write-up is prepared for sharing my thoughts on urbanization, urban development and planning and makes a call for a broad base, scaled-up approach focusing on policies, planning and actions that can help to make local voice collective and heard to insist a collective actions to make a difference and create well-governed and better managed livable cities in Nepal.
Lawrence Esho
George Martine
michael goldman
Zafri Radzi
Nancy Odendaal
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Table of Contents
Before conducting a study, a research proposal should be created that outlines researchers’ plans and methodology and is submitted to the concerned evaluating organization or person. Creating a research proposal is an important step to ensure that researchers are on track and are moving forward as intended. A research proposal can be defined as a detailed plan or blueprint for the proposed research that you intend to undertake. It provides readers with a snapshot of your project by describing what you will investigate, why it is needed, and how you will conduct the research.
Your research proposal should aim to explain to the readers why your research is relevant and original, that you understand the context and current scenario in the field, have the appropriate resources to conduct the research, and that the research is feasible given the usual constraints.
This article will describe in detail the purpose and typical structure of a research proposal , along with examples and templates to help you ace this step in your research journey.
A research proposal¹ ,² can be defined as a formal report that describes your proposed research, its objectives, methodology, implications, and other important details. Research proposals are the framework of your research and are used to obtain approvals or grants to conduct the study from various committees or organizations. Consequently, research proposals should convince readers of your study’s credibility, accuracy, achievability, practicality, and reproducibility.
With research proposals , researchers usually aim to persuade the readers, funding agencies, educational institutions, and supervisors to approve the proposal. To achieve this, the report should be well structured with the objectives written in clear, understandable language devoid of jargon. A well-organized research proposal conveys to the readers or evaluators that the writer has thought out the research plan meticulously and has the resources to ensure timely completion.
A research proposal is a sales pitch and therefore should be detailed enough to convince your readers, who could be supervisors, ethics committees, universities, etc., that what you’re proposing has merit and is feasible . Research proposals can help students discuss their dissertation with their faculty or fulfill course requirements and also help researchers obtain funding. A well-structured proposal instills confidence among readers about your ability to conduct and complete the study as proposed.
Research proposals can be written for several reasons:³
Research proposals should aim to answer the three basic questions—what, why, and how.
The What question should be answered by describing the specific subject being researched. It should typically include the objectives, the cohort details, and the location or setting.
The Why question should be answered by describing the existing scenario of the subject, listing unanswered questions, identifying gaps in the existing research, and describing how your study can address these gaps, along with the implications and significance.
The How question should be answered by describing the proposed research methodology, data analysis tools expected to be used, and other details to describe your proposed methodology.
Here is a research proposal sample template (with examples) from the University of Rochester Medical Center. 4 The sections in all research proposals are essentially the same although different terminology and other specific sections may be used depending on the subject.
If you want to know how to make a research proposal impactful, include the following components:¹
1. Introduction
This section provides a background of the study, including the research topic, what is already known about it and the gaps, and the significance of the proposed research.
2. Literature review
This section contains descriptions of all the previous relevant studies pertaining to the research topic. Every study cited should be described in a few sentences, starting with the general studies to the more specific ones. This section builds on the understanding gained by readers in the Introduction section and supports it by citing relevant prior literature, indicating to readers that you have thoroughly researched your subject.
3. Objectives
Once the background and gaps in the research topic have been established, authors must now state the aims of the research clearly. Hypotheses should be mentioned here. This section further helps readers understand what your study’s specific goals are.
4. Research design and methodology
Here, authors should clearly describe the methods they intend to use to achieve their proposed objectives. Important components of this section include the population and sample size, data collection and analysis methods and duration, statistical analysis software, measures to avoid bias (randomization, blinding), etc.
5. Ethical considerations
This refers to the protection of participants’ rights, such as the right to privacy, right to confidentiality, etc. Researchers need to obtain informed consent and institutional review approval by the required authorities and mention this clearly for transparency.
6. Budget/funding
Researchers should prepare their budget and include all expected expenditures. An additional allowance for contingencies such as delays should also be factored in.
7. Appendices
This section typically includes information that supports the research proposal and may include informed consent forms, questionnaires, participant information, measurement tools, etc.
8. Citations
Writing a research proposal begins much before the actual task of writing. Planning the research proposal structure and content is an important stage, which if done efficiently, can help you seamlessly transition into the writing stage. 3,5
Key Takeaways
Here’s a summary of the main points about research proposals discussed in the previous sections:
Q1. How is a research proposal evaluated?
A1. In general, most evaluators, including universities, broadly use the following criteria to evaluate research proposals . 6
Q2. What is the difference between the Introduction and Literature Review sections in a research proposal ?
A2. The Introduction or Background section in a research proposal sets the context of the study by describing the current scenario of the subject and identifying the gaps and need for the research. A Literature Review, on the other hand, provides references to all prior relevant literature to help corroborate the gaps identified and the research need.
Q3. How long should a research proposal be?
A3. Research proposal lengths vary with the evaluating authority like universities or committees and also the subject. Here’s a table that lists the typical research proposal lengths for a few universities.
Arts programs | 1,000-1,500 | |
University of Birmingham | Law School programs | 2,500 |
PhD | 2,500 | |
2,000 | ||
Research degrees | 2,000-3,500 |
Q4. What are the common mistakes to avoid in a research proposal ?
A4. Here are a few common mistakes that you must avoid while writing a research proposal . 7
Thus, a research proposal is an essential document that can help you promote your research and secure funds and grants for conducting your research. Consequently, it should be well written in clear language and include all essential details to convince the evaluators of your ability to conduct the research as proposed.
This article has described all the important components of a research proposal and has also provided tips to improve your writing style. We hope all these tips will help you write a well-structured research proposal to ensure receipt of grants or any other purpose.
References
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How to write a phd research proposal.
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UNEP is seeking partners committed to environmental sustainability. Below is a list of all current open calls for proposal relating to UNEP project and activities. Potential partners are invited to review the requirements related to calls for proposal which they are interested in by following the links provided and submit applications in accordance with the instructions given in the call for proposal.
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Title : call for proposals - addressing unique drivers of united states household food waste, title : call for wwqa workstream proposals and seed funding applications 2022/2023, title : fourth call for application - global ecosystem-based adaptation fund, title : structuring and regulation of the climate change fund of the republic of paraguay, title : call for applications: adaptation fund climate innovation accelerator – unep-ctcn.
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Environmental project proposal, 7+ sample environmental project proposal, what is an environmental project proposal, ideas for an environmental project proposal, pressing environmental issues , how to create an environmental project proposal, how do you write an environmental proposal, what are some environmental projects, which is the best topic for an environmental project.
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Submissions continued to increase in terms of both absolute numbers and in the number of companies with a proposal on the ballot
56% of S&P 500 companies received at least one and 8% received five or more shareholder proposals for
their 2024 AGMs
Labor unions submitted nearly 200% more Rule 14a-8 proposals compared to H1 2023
Proposals from "anti-ESG" proponents, which more than tripled between 2021 and H1 2023, increased by
a further 21% from H1 2023, but shareholder support remained low (averaging only 3%)
Companies were less willing to settle and more willing to seek to exclusion
No-action requests increased by 45% year-over-year (with a 62% increase in requests on substantive
The number of successful no-action requests increased by 76% compared to H1 2023, leading to a
decrease in voted proposals for the first time in recent years
Exxon obtained a proponent's commitment not to resubmit similar proposals after litigating against the
Governance submissions increased for the first time in recent years
Voted proposals, however, declined by 16% compared to H1 2023, driven by a 67% no-action success
Passing proposals increased by 193% compared to H1 2023, driven by a large number of submissions
requesting the elimination of supermajority requirements
Social/political submissions plateaued but remained the largest category, with 17% more going to a vote compared to H1 2023
Average support declined across all topics, including policymaking focus areas such as diversity and
human capital management
Only one proposal passed (vs. five in H1 2023 and 21 in H1 2022)
After years of significant growth, environmental submissions remained level overall, but proposals from "anti-ESG" proponents significantly increased while those from other proponents decreased
Overall, support remained consistent with H1 2023; however, average support increased excluding
proposals from "anti-ESG" proponents
Support for GHG target-setting and reporting was meaningfully higher for proposals that excluded Scope 3
than those that included Scope 3; the only two passing environmental proposals were GHG proposals excluding Scope 3
Compensation proposals, which saw a 60% increase in H1 2023, increased by a further 5%, but none passed
INTRODUCTION
Our annual proxy season review memo summarizes significant developments relating to the 2024 U.S. annual meeting proxy season. Our review comprises two parts. Part 1 covers Rule 14a-8 shareholder proposals and other "hot topics" (e.g., universal proxy developments, "floor" proposals and relevant litigation and regulatory developments). We expect to issue Part 2, which will cover say-on-pay voting and equity compensation plan voting, in the coming weeks. We will also host our annual webinar in September to discuss 2024 proxy season developments. The Rule 14a-8 shareholder proposals we discuss are those submitted to and/or voted on at annual meetings of the U.S. members of the S&P Composite 1500, which covers approximately 90% of U.S. market capitalization, at meetings held on or before June 30, 2024. We estimate that around 90% of U.S. public companies held their 2024 annual meetings by that date. The data on submitted, withdrawn and voted-on shareholder proposals derives, in part, from Institutional Shareholder Services' ("ISS") voting analytics with respect to known shareholder proposals submitted this year to U.S. members of the S&P Composite 1500. We have supplemented the ISS data with information published by proponents and companies, and based on our independent research, experience and knowledge. The number of proposals submitted includes proposals that were excluded from a company's proxy statement as a result of the U.S. Securities and Exchange Commission's ("SEC") no-action process or withdrawn after being included in a company's proxy statement (usually following engagement with the company). The data on submitted proposals understates the number of proposals actually submitted, as it does not include proposals that were submitted and then withdrawn unless either the proponent or the company disclosed the proposal (e.g., referenced in the company's proxy statement, reported to ISS or posted on their websites). For a comprehensive discussion of U.S. public company governance, disclosure and compensation, see the Public Company Deskbook: Complying with Federal Governance and Disclosure Requirements (Practising Law Institute) by our colleagues Marc Trevino and Benjamin Weiner, available at http://www.pli.edu or by calling 1-800-260-4754 (1-212-824-5700 from outside the United States) .
2024 Proxy Season Review Part 1 Rule 14a-8 Shareholder Proposals
TABLE OF CONTENTS
Part I. Rule 14a-8 Shareholder Proposals .................................................................................................... 1
A. Overview of Shareholder Proposals ................................................................................... 1
B. Who Makes Shareholder Proposals ................................................................................... 3 1. Robust Union Activity ............................................................................................. 4 2. Continued Engagement from "Anti-ESG" Proponents ........................................... 5
C. Targets of Shareholder Proposals ...................................................................................... 6 1. Focus on Large Cap Companies ........................................................................... 7 2. Focus on Retail, Tech and Financial Sector Companies....................................... 7
D. Social/Political Proposals .................................................................................................... 8 1. Post-Harvard, Diversity Proposals Received Lower Support ................................ 9 2. Increased Submission and Decreased Support of Labor and Human Capital Management Topics ................................................................................ 12 3. Emerging Focus on AI ......................................................................................... 13 4. Steady Increase in Business Human Rights Proposals ...................................... 14 5. Political Spending/Lobbying................................................................................. 15
E. Governance Proposals ..................................................................................................... 15 1. Resurgence of Supermajority Proposals ............................................................. 16 2. Low Success of Proposals on Director Resignation Bylaws ............................... 17 3. Continued Scrutiny of Advance Notice Bylaws .................................................... 18 4. Record Low Submissions on Independent Board Chair and Other Board Composition Proposals ............................................................................. 20
F. Environmental Proposals .................................................................................................. 21 1. Decreased Industry Focus on Energy/Utilities Companies ................................. 21 2. Shareholder Support Diverged Depending on Whether a Climate Proposal Included Scope 3 .................................................................................. 22 3. Increased Submissions on Nature-Related Topics Reflected Recent Global Momentum in This Area ........................................................................... 24 4. "Just Transition" Proposals Increased by 50%, But Were Likely To Be Withdrawn....................................................................................................... 25
G. Compensation Proposals .................................................................................................. 25 1. Continued Focus on Severance Proposals ......................................................... 26 2. Steep Increase in Clawback Policy Proposals..................................................... 27 3. Divergent Proposals on ESP-Linked Compensation ........................................... 27
H. Exclusionary Relief--SEC No-Action and Beyond ........................................................... 28 1. Increased Success with the SEC......................................................................... 29 2. Increased Success on "Violation of Law" and "Ordinary Business" Bases ................................................................................................................... 29 3. SEC's Average Response Time Remains Around 70 Days ................................ 30 4. Exxon's Lawsuit to Exclude GHG Proposal ......................................................... 30
I. Exempt Solicitation............................................................................................................ 32
J. Proxy Advisory Firm Requirements .................................................................................. 32
K. Meeting Procedure............................................................................................................ 32
PART I. RULE 14A-8 SHAREHOLDER PROPOSALS
A. OVERVIEW OF SHAREHOLDER PROPOSALS1
Type of Proposal2 Social/Political
Social Capital Management Diversity/Anti-discrimination Political Spending/Lobbying Human Capital Management Artificial Intelligence Reproductive Rights Voting Alignment Governance Structural Governance Board Composition Misc. Governance Environmental Climate Nature Just Transition Board Oversight Supply Chain Sustainability Other Environmental Compensation Total
H1 2024 365 101 100 81 54 13 10 6 244 157 45 42 170 101 36 16 8 6 3 79 858
FY 2023 389 114 122 93 34 1 25 0 229 103 95 31 187 134 27 11 7 2 6 84 889
H1 2024 249 64 73 62 29 10 7 4 150 95 39 16 87 55 13 6 7 5 1 60 546
FY 2023 233 84 61 54 20 1 13 0 188 81 87 20 99 70 11 8 7 1 2 71 591
Average Support
H1 2024 15% 12% 13% 21% 17% 20% 7% 8% 42% 51% 30% 14% 17% 19% 14% 19% 8% 12% 18% 14% 23%
FY 2023 18% 13% 18% 24% 29% 21% 10% -- 30% 34% 30% 16% 21% 24% 21% 22% 5% 14% 11% 21% 23%
H1 2024 1 0 0 1 0 0 0 0
0 2 2 2 0 0 0 0 0 0 44
FY 2023 5 0 3 0 2 0 0 0
0 1 2 2 0 0 0 0 0 4 28
Down from H1 2023
Up from H1 2023
Consistent with H1 2023
Two themes underscored this proxy season. First, proponents and companies were more willing to experiment. Proponents submitted proposals on novel topics and confronted companies outside of the typical Rule 14a-8 process, launching the first "universal proxy" board fight to increase leverage in collective bargaining negotiations and submitting "floor" proposals to circumvent restrictions under Rule 14a-8 (see Section B). Companies submitted more no action requests (see Section H) and using other, less conventional tools at their disposal (e.g., Exxon choosing to go straight to court to exclude one of its proposals).
Second, submission, and especially voting, trends reflected the impacts of a particularly active year for
U.S. legal and regulatory developments. For example, in the first proxy season after the Supreme Court's
1 Unless otherwise noted, we present H1 2024 and full year 2023 data in the tables throughout this publication for completeness, although the indicative symbols used in the tables compare H1 2024 with H1 2023 data, rather than the full year 2023 data presented. In addition, in the discussion, we generally assess year-over-year changes by comparing H1 2024 and H1 2023 data for consistency.
2 See Sections D and E, respectively, for the specific topics under each category, including (1) human capital management (i.e., non-DEI workforce-related proposals) and social capital management (i.e., non-DEI impacts on non-employee stakeholders) and (2) structural governance (i.e., proposals related to companies' defensive profile) and miscellaneous governance. See Section B for information on shareholder support for proposals from so-called "anti-ESG" proponents (i.e., proponents whose official websites state that they are asking companies to reconsider "ESG" or "woke/liberal" agenda).
June 2023 decision striking down affirmative action programs at Harvard and the University of North Carolina, shareholder support declined on proposals related to diversity, equity and inclusion ("DEI") even though a substantial number were submitted. In addition, before most H1 2024 annual meetings were held, the SEC adopted its long-awaited climate disclosure rules, which eliminated the proposed requirement to disclose Scope 3 (indirect value chain) emissions metrics. When voted at subsequent shareholder meetings, proposals involving Scope 3 commitments received lower support compared to those excluding such commitments (see Section F). Furthermore, U.S. regulators have indicated a recent focus on human capital management and artificial intelligence ("AI"), corresponding with meaningful numbers of submissions in both areas (see Section D).3
In total, the number of Rule 14a-8 proposals submitted to S&P Composite 1500 companies reached over 850 for the first time in the core proxy season.
Similar to prior years, proposals on environmental and social/political ("ESP") topics represented the majority of submissions (62% vs. 65% in H1 2023). However, unlike prior years, governance proposals-- which had been on a consistent decline--meaningfully increased (by 13% year-over-year). In another departure from recent trends, voted shareholder proposals decreased (by two percentage points to 64% voted from 66% in H1 2023), driven by a 76% year-over-year increase in proposals excluded through the SEC no-action process. Although average shareholder support stayed level with H1 2023 (at 23%), the
3 A series of Supreme Court decisions relating to the authority of regulatory agencies (including SEC v. Jarkesy, Loper Bright Enterprises v. Raimondo and Corner Post, Inc. v. Board of Governors of the Federal Reserve System) came too late to have any discernible impact on this year's proxy season.
pass rate increased (8% vs. 5% in H1 2023), driven by a 193% increase in the number of passing governance proposals.4
B. WHO MAKES SHAREHOLDER PROPOSALS
Named Filers
H1 2024 (vs. H1 2023)
Social/ Political
Governance Environmental Compensation
1 John Chevedden
2 As You Sow
National Center for Public Policy Research
4 Kenneth Steiner
5 Carpenters Union
Mercy Investment Services
Green Century Capital Management
James McRitchie/ Myra Young
9 NYC/NYS Retirement
National Legal and Policy Center
Individual Proponents
Social Investment Entities
"Anti-ESG" Proponents
Other Proponents
No submission in H1 2023
The 2024 proxy season was marked by record engagement from labor unions, which brought nearly three times the number of Rule 14a-8 proposals they did last year, in addition to other forms of engagement discussed below. Otherwise, proponent-related trends were fairly consistent with 2023.
Proposals from the top 10 proponents once again accounted for a substantial majority of submissions, with individual proponents--John Chevedden, Kenneth Steiner, James McRitchie and Myra Young-- representing 29% of all submissions and 61% of governance submissions (vs. 30% and 74% in H1 2023). Religious organizations--which submitted a similar number of proposals as last year (86 vs. 80 in H1 2023)--continued to focus on social/political topics. Social investment entities (i.e., ESG funds and other institutions with a mandate to make "socially responsible" investments) remained the primary drivers of environmental proposals, although their cumulative submissions decreased this year, with As You Sow and Green Century Capital submitting 43% of all environmental proposals (vs. 40% in H1 2023). Last year, we predicted that public pension funds would be less active than they had been in previous years, in part due to laws adopted in over 20 states restricting use of ESG-related factors by public pension fiduciaries in investment and voting decisions. Consistent with our prediction, the New York City and State retirement funds were the only public pension funds that submitted a meaningful number of
4 In this publication, we refer to a proposal as "passing" if it received a majority of votes cast, regardless of whether this is the threshold for shareholder action under state law or the company's organizational documents.
proposals. We continued to see robust activity from "anti-ESG" proponents, which included two of the top 10 proponents and submitted 108 proposals (vs. 90 in H1 2023).
1. Robust Union Activity
In the months following the high-profile strikes by the United Auto Workers, the Writers Guild of America and the Screen Actors Guild-American Federation of Television and Radio Artists, unions used a variety of methods to further amplify their messaging through the proxy process. In addition to Rule 14a-8 proposals, unions took advantage of mechanisms such as universal proxy and "floor" proposals. Given the outcomes achieved, unions and other proponents may increase their use of these tools in the coming proxy season. In some 2024 engagements, union proponents already have indicated that they intend to continue active engagement in future proxy seasons, and have invited some of their target companies this proxy season to join a working group on governance.
Universal proxy. Last fall, the Strategic Organizing Center ("SOC"), a coalition of North American labor unions, commenced the first ESG-focused proxy fight since the adoption of the SEC's universal proxy rule. SOC, which owned less than 0.00002% of Starbucks' stock, nominated three director candidates to the Starbucks board in a campaign focused on Starbucks' perceived failure to oversee human capital management and address labor rights issues. On February 27, 2024, Starbucks announced that it would begin discussions with union groups on a foundational framework to achieve collective bargaining agreements, including a fair process for organizing and the resolution of outstanding labor-related litigation. After the announcement, proxy advisory firms ISS and Glass Lewis both recommended in favor of Starbucks' director nominees, declining to support those recommended by SOC. Subsequently, on March 5, 2024, eight days before Starbucks' March 13 annual meeting, SOC withdrew its nominations, citing Starbucks' commitments and noting that SOC had "meaningful dialogue" with a number of other shareholders who are "optimistic" that Starbucks has committed to these changes in good faith.
"Floor" proposals. On March 26, 2024, United Mine Workers of America ("UMWA") announced that it and the American Federation of Labor and Congress of Industrial Organizations ("AFL-CIO") were launching a proxy solicitation at Warrior Met Coal, a mining company. The company had faced laborrelated legal proceedings, as well as a strike from UMWA members. In early March, UMWA and AFLCIO filed five shareholder proposals--with four proposals related to corporate governance matters5 and one proposal requesting an assessment of the company's labor relations. These proposals were filed as "floor" proposals, which are proposals submitted pursuant to a company's organizational documents and that federal law does not require companies to include in their proxy materials.6 This approach allowed
5 The corporate governance proposals concerned (1) poison pills, (2) proxy access, (3) blank check preferred stock and (4) golden parachutes.
6 Most companies permit "floor" proposals under their bylaws. Compared to the Rule 14a-8 requirements, these bylaws generally provide for more limited information and procedural requirements for submitting a proposal that
the unions to bypass Rule 14a-8 limits, including the requirement that each proponent only submit one proposal. This approach also would have required the unions to distribute their own solicitation materials to shareholders under Rule 14a-4, which may have not attracted the same level of attention from shareholders as proposals in the company's proxy. However, Warrior Met Coal ultimately decided to include all five proposals in its proxy, in part because of logistical considerations related to the proxy process. The governance proposals all passed, achieving between 51% and 99% of votes cast, and the labor relations proposal received 46% of votes cast.
Rule 14a-8 proposals. Proposals from union proponents increased by nearly 200% year over year. In prior years, no individual union ranked in the top 10 proponents. This year, the New York City, North Atlantic States and Mid-America carpenters unions ranked fifth on the list of top proponents, submitting 38 proposals requesting more stringent director resignation requirements for directors that fail to achieve majority support in an uncontested election. As further discussed in Section E, most of these director resignation bylaw proposals were either excluded on the basis that they would violate Delaware law, or withdrawn after the SEC granted no-action relief on the proposals at other companies. Although these governance proposals from the carpenters unions accounted for over one-third of union submissions this year, other unions also submitted more proposals than they did last year, focusing on social/political and environmental topics. For example, the International Brotherhood of Teamsters and Service Employees International Union ("SEIU") submitted more "just transition" proposals this year, which they put forward for the first time last year and which focus on workers and other stakeholders who are likely to be left behind in the transition to a low-carbon economy. These and other union proponents focused on social/political topics such as labor and human capital management, as further discussed in Section D. Where union proposals were voted upon, they achieved an average of 23% of votes cast, which is consistent with results in prior years but meaningfully lower than the votes achieved through the Warrior Met Coal "floor" proposals.
2. Continued Engagement from "Anti-ESG" Proponents Proposals from "anti-ESG" proponents, which grew from 25 in full-year 2021 to 90 in H1 2023, increased by a further 21% year over year, exceeding 100 for the first time. Their proposals for the 2024 proxy season were largely focused on social and environmental issues. Proposals from the National Center for Public Policy Research ("NCPPR") and the National Legal and Policy Center ("NLPC"), the two most prolific "anti-ESG" proponents, accounted for 13% of all social/political proposals and 11% of all environmental proposals in H1 2024. Social proposals from "anti-ESG" proponents tended to focus on DEI programs and policies, including proposals regarding the risks of omitting viewpoint and ideological
a company must bring to a vote at its shareholder meeting but does not have to include in its proxy statement. In addition, these bylaws also generally provide for a later submission deadline compared to the deadline for submitting a Rule 14a-8 proposal.
diversity from a company's equal employment opportunity ("EEO") policy and on risks created by corporate DEI efforts. Environmental proposals centered around board oversight of corporate financial sustainability and the risks of voluntary carbon-reduction commitments, including the impact of greenhouse gas ("GHG") reduction policies on revenue generation.
Proposals from "anti-ESG" proponents continued to target larger and more high-profile companies. In the 2024 proxy season, "anti-ESG" proponents submitted all but six of their proposals to companies in the S&P 500. Consistent with 2023, "anti-ESG" proponents focused their attention on financial services companies (which received 31% of these proponents' submissions vs. 25% in H1 2023), consumer
goods/retail companies (29% vs. 28% in H1 2023) and technology companies (20% vs. 19% in H1 2023). Several companies faced multiple proposals from "anti-ESG" proponents.
Consistent with last year, companies requested to exclude proposals from "anti-ESG" proponents at a
higher rate than for proposals from other proponents, with no-action requests submitted for 43% of proposals from "anti-ESG" proponents (46 out of 108 total) compared with 25% of other proposals (189
out of 750 total). Unlike the 2023 proxy season, where these proposals were over twice as likely to be
excluded than proposals from other proponents, the success rate for no-action requests to exclude proposals by "anti-ESG" proponents decreased to 41% (vs. 76% for H1 2023 proposals) and was markedly lower than the success rate (74%) for other proposals. Settlements with "anti-ESG" proponents
remained rare, and proposals from these proponents went to a vote in almost all cases where they were
not excluded. When voted, these proposals continued to garner low levels of support, generally less than
2% of the vote.
Type of Proposal
Social/Political "Anti-ESG" Proponents
Governance "Anti-ESG" Proponents
Environmental "Anti-ESG" Proponents
Compensation "Anti-ESG" Proponents
Total "Anti-ESG" Proponents
H1 2024 365 69 296 244 15 229 170 20 150 79 4 75 858 108 750
FY 2023 389 70 319 229 13 216 187 11 176 84 0 84 889 94 795
H1 2024 249 59 190 150 6 144 87 18 69 60 3 57 546 86 460
FY 2023 233 47 186 188 11 177 99 9 90 71 0 71 591 67 524
H1 2024 15% 2% 19% 42% 10% 43% 17% 2% 21% 14% 1%
FY 2023 18% 3% 22% 30% 15% 31% 21% 2% 23% 21%
H1 2024 1 0 1
41 2 0 2 0 0 0
FY 2023 5 0 5
17 2 0 2 4 0 4
C. TARGETS OF SHAREHOLDER PROPOSALS
This year, the number of companies with at least one Rule 14a-8 proposal on the ballot continued to
increase (279 vs. 262 companies in H1 2023 and 233 in H1 2022). High-profile companies continued to
receive multiple proposals, with 40 companies receiving five or more proposals (vs. 44 companies in H1 2023) and 11 companies receiveing 10 or more proposals (vs. 10 companies in H1 2023).
1. Focus on Large Cap Companies
Consistent with prior years, large-cap companies received the vast majority of shareholder proposals and accounted for almost all Rule 14a-8 proposals that shareholders voted on (88% in H1 2024). 7 Furthermore, proponents focused new proposals on large-cap companies--for example, 77% of the union-led director resignation bylaw proposals and all 13 of the AI proposals were submitted at S&P 500 companies. Although proposals were less likely to reach a vote at small- and mid-cap companies than at large-cap companies (51% of submissions vs. 66%), voted proposals at the smaller companies received higher support (30% of votes cast on average vs. 22%).
2. Focus on Retail, Tech and Financial Sector Companies
Consistent with last year, consumer goods/retail companies received the largest number of proposals overall (27% vs. 25% in H1 2023, a disproportionately high portion relative to their representation among the S&P Composite 1500 (19%)). Consumer goods/retail companies also far surpassed all other industries in terms of social/political and environmental proposals. Technology companies received the second-largest number of proposals overall (17% vs. 16% in H1 2023), including the largest number of governance proposals (21% vs. 17% in H1 2023) and compensation proposals (24% vs. 21% in H1 2023). Companies in the financials sector received the third-largest number of proposals overall (17% vs. 16% in H1 2023). The number of proposals
* % of S&P Composite 1500 companies in
7 In this publication, we refer to S&P 500 companies as "large cap," the next largest S&P 400 companies as "mid cap" and the next largest S&P 600 companies as "small cap."
submitted at energy/utilities companies decreased (7% vs. 11% in H1 2023), driven by a decrease in the environmental submissions at these companies (with environmental proposals comprising 14% of total submissions at these companies vs. 32% in H1 2023).
D. SOCIAL/POLITICAL PROPOSALS
Type of Proposal Social Capital Management
Human Rights Animal Welfare Access to Medical Products Operations in China8 Charitable Contributions Other SCM9 Diversity/ Anti-discrimination
Anti-discrimination
DEI Efforts
EEO-1 Reporting Political Spending/Lobbying Human Capital Management
Employee Health/Safety Collective Bargaining Living Wage Other HCM10 Artificial Intelligence Reproductive Rights Voting Alignment
Submitted H1 2024 FY 2023
Voted On H1 2024 FY 2023
Average Support H1 2024 FY 2023
8% 16% 23% 12%
13% 22% 31%
Passed H1 2024 FY 2023
0 0 0 0 0 0
0 1 0 1 0 1 0 0
8 17% 8 24% 0 9% 4 10% 1 20% 13 7% 0 8%
-- 21% 21% 10%
0 0 0 0 0 0 0
1 1 0 0 0 0 0
Although this remained the largest category of submissions, social/political proposals have plateaued (365, on par with 361 in H1 2023) after more than doubling between 2012 and 2023. Over half of the submissions in this category targeted S&P 100 companies, and consumer/retail companies once again received a disproportionately high percentage of these proposals (34%).
8 This year, there were only four proposals on risks related to operating in China (at Berkshire Hathaway, IBM, Boeing and MSCI), compared to 17 last year. Consistent with last year, these proposals were all submitted by "anti-ESG" proponents.
9 Other social capital management proposals in H1 2024 generally addressed company-specific issues (e.g., company-specific product safety, advertising and content safety issues). This subcategory also included two proposals on political de-banking and one on the use of merchant category codes (all from "anti-ESG" proponents).
10 Other human capital management proposals in H1 2024 included four proposals regarding hiring practices with respect to formerly incarcerated people, one regarding concealment clauses and seven regarding companyspecific employee issues.
Despite the overall decrease in voted proposals this proxy season, the percentage of voted social/political proposals continued to trend upwards. This year, 68% of social/political proposals went to a vote (vs. 59% in H1 2023). The increased percentage of voted proposals is due to two factors--meaningfully lower likelihood of withdrawal and low success rates for no-action requests. Social/political proposals were also 25% less likely to be withdrawn than last year, with many companies citing legal or regulatory uncertainty in opposition statements to proposals that were often privately settled in prior years (e.g., DEI and human capital management disclosures). In addition, companies requested no-action relief on social/political proposals with respect to 20% of submissions (up from 10% of submissions in H1 2023), but this category had the lowest no-action success rate across all categories (52% for this category vs. 74% for other categories). These factors had the greatest impact on social/political proposals in the financial sector, where voted proposals increased by 57% compared to last year.
Typical for this category, topics and trends reflected the impacts of the prior year's most high-profile legal and sociopolitical developments, such as (1) the Supreme Court's decision in Harvard and the continuing national debate on DEI, (2) the union-driven focus on labor issues and (3) the recent regulatory and stakeholder focus on AI. While proponents submitted a meaningful number of proposals on each of these topics this year, reproductive rights proposals--which came into focus last proxy season after the Supreme Court's 2022 decision in Dobbs v. Jackson Women's Health Organization--declined this year.
Average shareholder support for social/political proposals continued to decrease. Although the overall decrease in average shareholder support was only three percentage points, there were more significant declines on "hot topics" such as diversity/anti-discrimination and labor/human capital management, as shown in the preceding table. No social/political category received 25% or more average support in H1 2024, whereas four such categories did in FY 2023. Only one proposal (a political contribution proposal) passed (vs. five in 2023 and 21 in 2022).
1. Post-Harvard, Diversity Proposals Received Lower Support
Harvard and subsequent legal developments. On June 29, 2023, the Supreme Court issued its opinion in Students for Fair Admissions, Inc. v. President and Fellows of Harvard College, holding that the race-based admission programs of Harvard and the University of North Carolina violated the Equal Protection Clause of the Fourteenth Amendment and, by extension, Title VI of the Civil Rights Act of 1964 (which applies to programs receiving federal assistance). The decision does not directly apply to private employers, but given the similarity in the language between Title VI and statutes prohibiting discrimination in employment (Title VII of the Civil Rights Act) and contracting (42 U.S.C. 1981), there was an immediate and active national debate on whether and to what extent Harvard applied to private-sector DEI initiatives. Just two weeks after the decision, 13 Republican state attorneys general sent a letter to Fortune 100 companies, urging them to comply with the "race-neutral principles" articulated in Harvard in their employment and contracting practices. The following week, 21 Democratic state attorneys general
responded with their own letter to Fortune 100 companies, reassuring the companies that their corporate DEI efforts are legal and should be continued. The Equal Employment Opportunity Commission also issued a statement that it remains lawful for employers to implement DEI programs.
In the past year, a number of companies have faced lawsuits challenging their DEI programs, and some courts have already extended Harvard's reasoning to private-sector initiatives. Notably, in a June 3, 2024 decision, the U.S. Court of Appeals for the Eleventh Circuit found that a funding competition for Black women-owned businesses "is substantially likely to violate" 1981 because it presented an "absolute bar" for non-Black applicants. In addition, there are now 21 laws across 18 states that restrict or limit DEI initiatives, 10 of which were adopted in 2024. These laws focus on public schools and other entities receiving federal/state assistance, although states have proposed laws that would apply to the private sector as well. Four states have recently adopted requirements to report on or promote the representation of historically underrepresented groups, but these likewise have limited applicability to private-sector DEI programs.
Submissions trends on diversity and anti-discrimination topics.11 Proponents that promoted gender and racial diversity efforts in prior years continued to submit substantial numbers of proposals requesting that companies enhance or disclose their DEI-related programs. The number of these proposals more than doubled (from 46 to 99 between 2020 and 2021) in the wake of George Floyd's death, led by proponents such as Trillium, As You Sow, Arjuna, James McRitchie, Myra Young, the New York State Comptroller and members of the Interfaith Center on Corporate Responsibility ("ICCR"). In 2024, the overall number of submissions in this area did not change significantly compared to prior years, although "anti-ESG" proponents submitted more of these proposals than ever (accounting for 36% of submissions vs. 21% last year) and focused more on this area than they did any other. Further, there was a sharp increase in the percentage of submissions that reached a vote (73% in H1 2024 vs. 50% in FY 2023), likely attributable to companies' greater reluctance to settle DEI proposals in the current legal and political landscape.
Shareholder support trends. Proposals on diversity and anti-discrimination were once the most highly supported social/political proposals, but this year received among the lowest support levels in the category. Average shareholder support on these topics exceeded 40% in 2021 but has been declining year over year since (to 28% in 2022 and 18% in 2023). Support decreased by a further five percentage points this year. This downward trend holds even after excluding proposals from "anti-ESG" proponents, which continued to receive lower than average support (less than 2% of votes cast, consistent with last
11 Given the developments in this area, we re-categorized proposals formerly included under human capital and social capital management (e.g., racial equity audits, wage gap, report on the impact/risks of DEI efforts) into a new subcategory this year. Notwithstanding this re-categorization, the diversity/anti-discrimination subcategory still does not fully capture proponent interest in this area, since a number of other proposals featured diversityrelated topics (e.g., racial impact of AI use and DEI-linked executive compensation).
year). Proposals from other proponents averaged 22% of votes cast this year, compared to 25% last year.
This trend is consistent with investor feedback that they are considering the uncertainty and potential legal risks associated with companies' gender- and race-based DEI commitments in the wake of the Harvard decision. It is also consistent with declining support from ISS, which recommended in favor of 71% of proposals requesting DEI commitments in the 2021 proxy season but only supported 38% this year.
Topics covered. The substance of the proposals on diversity and anti-discrimination did not change significantly from prior years. The plurality of proposals asked companies to assess and address potential discrimination in their policies and practices. Although the bulk of these proposals called for a third-party audit of potentially discriminatory policies and practices (i.e., the "civil rights audit" or "racial equity audit" proposals that began to proliferate in 2021), the total number of such proposals dropped to half of 2023 levels (19 vs. 39 in 2023) after receiving significantly lower support last proxy season. Similar to last year, third-party audit and other anti-discrimination proposals included both proposals focused on gender and racial impacts, and proposals from "anti-ESG" proponents who advocated for explicit inclusion of viewpoint and religious diversity in anti-discrimination assessments and policies. Support for anti-discrimination proposals continued to drop, falling to single-digit levels for the first time since 2021 (overall average of 8% of votes cast, 14% excluding proposals from "anti-ESG" proponents, vs. 13% and 20% in 2023).
In 2023, another prevalent DEI topic was to disclose the risks (mostly from "anti-ESG" proponents) or effectiveness of existing DEI efforts. Proponents submitted a similar number of these proposals this year. Compared to anti-discrimination proposals, these proposals fared better when voted, but nevertheless received lower support than last year (overall average of 16% of votes cast overall, 24% excluding proposals from "anti-ESG" proponents vs. 22% and 29% in 2023).
Even proposals to publish or enhance wage gap disclosures, which received consistently high support in prior years, saw a decline of eight percentage points in average support year over year. Proposals for companies to voluntarily publish their EEO-1 diversity data also received low support this year.
Predictions for future proxy seasons. Against the backdrop of the rapidly evolving legal landscape and ongoing litigation, we expect further recalibrations in the engagements between companies, proponents and other investors in this area. For example, we expect companies to be more hesitant to agree to implement voluntary DEI initiatives in the face of current legal uncertainty, as they were this proxy season. We have also seen companies re-evaluate voluntary commitments made in prior years, including those resulting from engagement with proponents and other investors. In some cases, companies suspended quantitative gender- or race-based representation targets. In many cases,
companies reframed DEI disclosures and policies to emphasize inclusion and belonging, including clarifying that their DEI programs do not exclude or discriminate against "non-diverse" stakeholders.
We expect robust activity from "anti-ESG" proponents to continue on these topics, including continued submission of proposals requesting that companies disclose the impact of DEI programs on "non-diverse"
employees and other stakeholders. However, we expect proponents of gender- and race-based DEI
initiatives to remain active as well, although they may explore different approaches in light of postHarvard legal developments and this year's results.
As we saw this year, companies receiving these proposals may face divergent responses from U.S. and non-U.S. investors, particularly as more non-U.S. jurisdictions adopt DEI-related regulations.12 In the
United States, there will likely be increasing pressure on institutional investors to take a cautious
approach when voting on DEI proposals. While lawmakers in several states and other stakeholders have
maintained a high level of scrutiny over U.S. institutional voting policies and metrics for DEI and other
ESG topics, groups such as ICCR have been engaging with the same institutional investors on the alignment between their DEI and ESG commitments and their proxy voting results.13 This proxy season,
in response to their decreasing support for ESG proposals, U.S.-listed investment management firms
received six proposals on the potential misalignment between their public commitments (particularly on
DEI) and their voting records.
2. Increased Submission of and Decreased Support for Labor and Human Capital Management Topics
Submission trends. Union activity this proxy season (discussed in Section B) contributed to a 51%
increase in labor and other non-DEI human capital management proposals. Not only did submissions on employee health and safety and collective bargaining14 increase by approximately 30%, but proponents submitted for the first time a meaningful number of proposals calling on companies to commit to "living wage" minimum compensation.
12 For example, Canada adopted a requirement under the Canada Business Corporations Act to disclose the representation of designated groups among its board of directors and senior management, as well as its policies for considering diversity in nominations and any diversity targets. The UK also recently adopted a requirement for listed companies to disclose information on the diversity of their boards and executives. Companies listed in the European Union and non-EU companies that have significant EU presence are subject to the European Corporate Sustainability Reporting Standards, which include disclosure requirements about a company's workforce, including its diversity.
13 Proposals submitted on these topics include the "voting alignment" proposals summarized in the table at the beginning of this section, which generally request that asset managers review and report on proxy voting data on topics such as climate change and diversity, and the alignment of such voting data with the companies' policies and public statements on such topics.
14 Collective bargaining proposals in 2024 included those requesting a third-party assessment of the company's commitment to workers' freedom of association and collective bargaining rights and those requesting adoption of a non-interference policy upholding the rights to freedom of association and collective bargaining. Compared to last year, where these proposals were dispersed across sectors, roughly one-third of this proxy season's collective bargaining proposals were concentrated in the industrials and materials sectors.
Voting trends. There was a 12 percentage point decrease in average shareholder support on non-DEI human capital management proposals. Collective bargaining proposals, which achieved support ranging from 26% to 52% (averaging 36%) last year, received on average 24% of votes cast this year, representing a 12 percentage point year-over-year decrease. Average support for employee health and safety proposals declined by a similar margin, dropping to 17% of votes cast on average.
SEC developments. Companies were more likely to seek and obtain no-action relief in this area than on other social/political topics. Of 21 no-action requests submitted in this area, the SEC granted 10, including six on the basis of "ordinary business," consistent with the SEC's position in previous years that employee issues were at the core of "ordinary business." Companies withdrew four of these no-action requests after the proponent abandoned their proposals. In other cases, companies chose not to pursue no-action relief or settle with proponents because they had already enhanced their human capital practices and disclosures in recent years. Moreover, because the SEC had announced that it would soon propose human capital disclosure requirements for issuers, some companies and investors were hesitant to embrace new or expanded human capital management disclosures and commitments requested by proponents. The SEC's human capital disclosure rulemaking has been repeatedly delayed. In September 2023, the SEC's Investor Advisory Committee ("IAC") recommended that the SEC propose rules enhancing issuer disclosures on workforce statistics (including demographic data), workforce turnover and the cost of the workforce, as well as requiring narrative disclosure of how an issuer's labor practices, compensation incentives and staffing fit within the broader corporate strategy. The SEC slated its rulemaking for Spring 2024 following the IAC recommendation, but its most recent rulemaking agenda sets forth an October 2024 deadline for a proposal on human capital management disclosures.
3. Emerging Focus on AI Regulatory focus. The rapid advancement of AI, particularly generative AI, has made it a "hot topic" for U.S. regulators over the last year. In October 2023, President Biden issued an executive order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence, which directed federal agencies to approach AI adoption in ways that minimize risks to national security, privacy and social concerns. In February 2024, SEC Chair Gary Gensler warned companies against "AI-washing," or making false or misleading claims about their AI use, which could violate securities laws, and in March 2024, the SEC announced its first enforcement action on AI-related disclosures. In July 2024, the New York State Department of Financial Services issued guidance on the use of AI in the insurance industry.15 There has been similar regulatory focus on AI outside the United States, with the European Parliament approving a new regulation in March 2024 that will require covered companies to mitigate AI-related risks.
15 A more detailed review of this guidance can be found in our July 12, 2024 memo.
Investor focus. Institutional investors are considering the implications of AI both for their own business strategy16 and for the companies in which they invest. BlackRock, Vanguard, State Street and other institutional investors have expressed both optimism and concerns about AI and its potential impact on corporate performance and shareholder value. To date, their engagement on AI has focused on boards' and managements' ability to exercise appropriate oversight. While most proxy voting guidelines do not yet specifically mention AI, institutional investors have been applying their general risk management and board oversight guidelines17 in the context of AI.
2024 proposals. In the 2024 proxy season, AI-related proposals constituted only a small percentage of submissions, but we expect they will continue to grow over the coming years. In H1 2024 there were 13 proposals, 10 of which went to vote. This year, proponents mainly focused on how AI fits within a company's broader corporate strategy, with eight proposals seeking additional disclosure on AI use and two seeking clarity on AI-related governance at the board and management levels. Three proposals specifically addressed concerns with the ethical use of AI, including concerns regarding racial bias resulting from AI use. Support for AI-related proposals averaged 20%, making them among the most highly supported social/political proposals, with one proposal (at Netflix) reaching 43% support.
4. Steady Increase in Business Human Rights Proposals
Submission and voting trends. Submissions on business human rights issues have increased slowly over recent years, reaching 25 proposals this proxy season. Nine proposals requested assessments of companies' human rights policies and impacts, including through third-party audits, and four specifically focused on supply chain child labor issues. While only 41% of human rights proposals reached a vote in 2021, shareholders voted on 80% of these proposals in both H1 2024 and FY 2023, as companies became less willing to settle in order to keep these proposals off the ballot.
Regulatory impact. Despite the continued decline in shareholder support (11% on average, compared to votes ranging from 18% to 95% in the 2021 proxy season), we expect continued engagement between companies, investors and other stakeholders on business human rights topics in the future. In particular, on May 24, 2024, the EU formally adopted the Corporate Sustainability Due Diligence Directive ("CSDDD"), which will require in-scope companies to identify, assess, prevent and mitigate adverse human rights and environmental impacts in their own operations, subsidiaries and value chains. This year, we saw at least 10 shareholder proposals requesting that companies evaluate and/or adopt policies on supplier and value chain human rights practices. In future proxy seasons, we expect growing engagement from customers, investors and other stakeholders on similar topics at companies with
16 For example, in November 2023, BlackRock published a guide to the investment implications of AI. 17 For example, Vanguard's guidelines provide that a board's failure to effectively identify, monitor and ensure
management of material risks and business practices is grounds for a vote against the responsible committees or individual directors.
significant EU revenues that are in scope of CSDDD, as well as companies that are in the value chain of in-scope companies.
5. Political Spending/Lobbying
With a presidential election this year, political spending and lobbying proposals remained one of the most prevalent topics this proxy season, but decreased compared to the same period last year (81 vs. 89 in H1 2023). This continued the trend we have observed over the last three election cycles, where submissions on political spending and lobbying hit troughs in election years but peaked around midterms. Average support decreased (to 21% from 24% in H1 2023), but one proposal (a political spending proposal at DexCom) passed, whereas none did in 2023.
This proxy season, we saw a continued decline in "congruency" proposals i.e., proposals requesting disclosure on the alignment between publicly disclosed ESG values and priorities, on the one hand, and political spending/lobbying activities, on the other hand (12 vs. 15 in H1 2023 and 20 in H1 2022). Whereas these proposals had received between 30% and 50% of votes cast in H1 2022, average support for "congruency" proposals hovered just below 20% this year, similar to H1 2023.
E. GOVERNANCE PROPOSALS
Type of Proposal Structural Governance
Eliminate Supermajority Vote Director Resignation Bylaw Special Meetings Advance Notice Bylaw Declassify Board Written Consent Dual Class Proxy Access Majority Voting for Directors Other Structural Board Composition Independent Chair Board Diversity/Skills Employee Director Misc. Governance
47 43 28 11 7 6 6 3 5 1
FY 2023 103 14 0 43 22 2 7 7 2 5 1 95 88 6 1 31
40 13 23 1 5 6 6 1 1 1
FY 2023 81 12 0 39 12 1 6 6 2 2 1 87 82 4 1 20
73% 17% 43% 2% 60% 37% 33% 99% 1%
34% 16% 88% 31% 34% 16% 38%
30% 30% 33% 19%
30 0 4 0 4 0 0 1 0 0
FY 2023 16 7 0 7 0 1 0 0 0 1 0 0 0 0 0 1
After steadily declining over the last five years, submissions on governance topics increased by 13% from
H1 2023. Over 80% of the governance proposals targeted S&P 500 companies and were spread across
multiple sectors, including technology, health care, financial institutions, consumer/retail and industrials.
Although submissions in this category increased, voted proposals dropped by 16%, driven by a high number of successful no-action requests (84% success rate, resulting in approximately a quarter of governance proposals being excluded). Yet for the proposals that reached a vote, the governance category was by far the most successful this year, with average shareholder support nearly three times that of other categories (42% vs. 15% across all other categories). Average shareholder support increased (by 10 percentage points from H1 2023) after a three-year decrease, and the pass rate reached the highest level since we began tracking (27%, reflecting a 193% year-over-year increase in the number of passing proposals).
Governance Proposals % Total Submissions % Voted Governance Proposals Average % of votes cast % Passing
H1 2018 43% 65% 37% 9%
H1 2019 45% 64% 37% 21%
H1 2020 45% 71% 33% 12%
H1 2021 38% 72% 40% 18%
H1 2022 31% 78% 35% 12%
H1 2023 26% 83% 29% 8%
H1 2024 29% 63% 42% 27%
The primary reason for the significant success on governance proposals was a return to classic, highly supported structural governance proposals, in particular, elimination of supermajority voting, and a shift away from board composition proposals, for which shareholder support has been declining.
Governance Proposals % Structural Proposals % Composition Proposals
H1 2018 65% 24%
H1 2019 53% 33%
H1 2020 61% 31%
H1 2021 73% 26%
H1 2022 66% 24%
H1 2023 45% 42%
H1 2024 64% 18%
Submitted board composition proposals reached a 10-year low (down 51% from H1 2023), mainly as a result of a significant decrease in independent chair proposals. The number of structural governance proposals submitted, in contrast, increased by 62% year over year. Support for structural governance proposals increased by 19 percentage points compared to H1 2023, and the pass rate more than doubled. In addition to proposals on classic governance topics, proponents continued to experiment with proposals on newer structural governance topics, such as director resignation bylaws (a new topic submitted mainly by unions) and "fair elections" under advance notice bylaws (many of which were recently enhanced in response to the SEC's universal proxy rule). These newer proposals failed to generate meaningful support.
1. Resurgence of Supermajority Proposals
Submission trends. After enjoying popularity over a decade ago, proposals requesting the elimination of supermajority voting requirements in charters and bylaws had dropped to single or low double digits in recent years. This year, proposals on this topic increased by 236% compared to last year, with 26% targeting small- and mid-cap companies (vs. 14% last year). Almost all these proposals were submitted by John Chevedden.
Voting trends. Companies managed to exclude five of these proposals through the no-action process, two on procedural grounds and three on the basis of "substantial implementation." Only two proposals
were withdrawn. For the 40 proposals that reached a vote, support averaged 73%, representing a 19 percentage point increase compared to last year. The number of proposals that passed increased by 329% (30 vs. seven in H1 2023), reflecting a 75% pass rate. ISS recommended in favor of all but two proposals (at Molina and Thermo Fisher, where the companies had already removed supermajority provisions and the proposals received 9% and 7% support, respectively). Excluding these two proposals, average support reached 77%.
2. Low Success of Proposals on Director Resignation Bylaws Current market standard. Over 80% of S&P 500 companies have adopted majority voting in uncontested elections. Almost all these companies have adopted requirements in their corporate governance guidelines or, less frequently, in their bylaws for a director failing to achieve majority support to submit a resignation to the board. Generally, these provisions allow the board and/or the governance committee to exercise discretion to accept or reject the resignation, and many require the company to make a public disclosure if the board ultimately determines that it is in the best interest of the company and its shareholders to reject the resignation.
Submission trends. For the first time, we saw a meaningful number of submissions asking companies to enhance the market-standard director resignation provisions. As discussed in Section B, the New York City, North Atlantic States and Mid-America carpenters unions submitted 38 of the 43 proposals on this topic.18 These proposals were virtually identical, requesting that (1) director resignation provisions be included in a company's bylaws (if not already the case), (2) the board accept resignations from directors who fail to achieve majority support unless it has identified and disclosed a "compelling reason" for rejecting the resignation and (3) a director's resignation be automatic if such director fails to achieve majority support for a second consecutive year.
No-action relief. As further discussed in Section H, 19 of these union-led proposals were excluded through the SEC no-action process, 14 of which were based on violation of Delaware law.19 In these cases, companies submitted opinions from Delaware counsel stating that the proposed changes, which limit the board's ability to exercise discretion, are inconsistent with directors' duties and powers under Delaware law.
After the SEC granted the first no-action requests on this basis, the unions withdrew eight proposals, including in at least four cases where the company did not seek exclusion on this basis. The unions
18 John Chevedden, Kenneth Steiner and Gary Perinar submitted the remaining five proposals on this topic, which were similar to the union proposals but generally required boards to refrain from nominating directors who fail to receive majority vote in an uncontested election. These five proposals were all voted, with shareholder support similar to those for the voted union proposals.
19 The other five proposals were excluded due to procedural defects.
generally withdrew after a company requested withdrawal based on the no-action outcomes at other companies.
Voting trends. Thirteen union-led director resignation proposals reached a vote, with support ranging from 10% to 26%, averaging 17% of votes cast. Given these low support levels, it is unclear whether proponents will continue to submit similar proposals in the coming proxy seasons. However, given investors' willingness to hold directors, particularly key committee chairs, accountable when expectations are not met, it is likely that proponents will continue to explore other so-called "accountability measures" for directors.
3. Continued Scrutiny of Advance Notice Bylaws Post-universal proxy advance notice bylaw updates. After the SEC's universal proxy rule became effective, hundreds of companies updated their advance notice bylaws. These updates typically included enhancements to the information and procedural requirements that a shareholder must satisfy in order to validly nominate a director.
Submission trends. Last proxy season, James McRitchie submitted 22 "fair elections" proposals requesting that companies obtain shareholder approval before they adopt certain bylaw amendments affecting shareholder nomination rights. 20 ISS recommended against all but one of the 2023 "fair election" proposals that went to a vote, which received an average of 16% of votes cast.21
Perhaps as a result of the low support last year, James McRitchie and his co-filers refashioned their "fair elections" proposals into proposals requesting the "fair treatment of shareholder nominees" this proxy season. There were 11 such proposals in H1 2024, which requested that companies adopt policies requiring boards to "treat shareholders' nominees equitably" and "avoid encumbering such nominations with unnecessary administrative or evidentiary requirements." In the supporting statement for these proposals, the proponent further explained that the policy may require companies to repeal advance notice bylaws that require nomination by record holders, D&O questionnaires from nominees, nominee interviews with the board or any committee thereof, disclosure to the company of publicly disclosed information and "excessive or inappropriate levels of disclosure" regarding nominee eligibility, background or experience.
20 As proposed, amendments that would trigger a shareholder approval requirement include (1) having an advance notice deadline that is more than 90 days before the annual meeting, (2) imposing new disclosure requirements for director nominees and (3) requiring nominating shareholders to disclose limited partners or business associates, except to the extent such investors own more than 5% of the company's shares.
21 The 2023 "fair election" proposal at Procter & Gamble, which criticized specific provisions instead of broadly criticizing fairly standard bylaw language, received ISS support and 43% of votes cast.
Voting trends. Only one "fair treatment" proposal reached a vote, with the other 10 being withdrawn (generally after the company agreed to add language in its existing policies or public disclosures that the board will focus on assessing shareholder nominees' qualification to serve, rather than their "suitability"). This outcome seems to indicate that companies were more willing to reach a settlement than they were last year, when less than half of advance notice bylaw proposals were withdrawn. The voted proposal (at Cognizant) garnered only 2% of votes cast.
Impact of recent Delaware decisions. Advance notice bylaw amendments faced a series of legal challenges during the last proxy season, most of which were settled before a judicial decision on the merits. On December 28, 2023, during the submission window for the core 2024 proxy season, the Delaware Court of Chancery issued an opinion in Kellner v. AIM Immunotech, the first decision to invalidate advance notice bylaw provisions amended after the adoption of the SEC universal proxy rules. The court found certain provisions, which were amended in the midst of an active proxy fight, to be unreasonable, including, among other language, the company's (1) definition of "Stockholder Associated Persons" and (2) overbroad disclosure requirements on arrangements, agreements or understandings relating to nominations. Despite striking down these provisions, the court found that the stockholder nomination notice was deficient under a previous, reasonable version of the provisions.
During the 2024 proxy season, while the Kellner decision was on appeal, plaintiffs' firms sent demand letters and filed lawsuits targeting a number of companies, challenging both the facial validity and companies' application of recently adopted advance notice provisions based on the reasoning in Kellner. In addition, some companies faced negative director recommendations from proxy advisors this year solely because the proxy advisors perceived the companies' bylaws as containing language similar to the invalidated provisions in Kellner. These developments may have made companies more willing to settle this year's "fair treatment" proposals.
The Delaware Supreme Court's decision in Kellner, issued on July 11, 2024, should alleviate some of the pressure on companies that have adopted advance notice bylaws on a "clear day" (i.e., not in connection with a proxy fight). The appellate court held that, other than an "indecipherable" provision, all the other challenged provisions were facially valid and not "contrary to law." This finding will likely curtail facial challenges to advance notice bylaws, many of which proliferated following the Court of Chancery's initial
opinion. However, applying enhanced scrutiny because the bylaws were adopted as a defense against an ongoing proxy contest, the Delaware Supreme Court found that the facially valid provisions were invalid as-applied, because the board's primary purpose in adopting and enforcing those provisions was to "thwart" the proxy contest by rejecting the competing slate of nominees and maintaining control.
There are other cases challenging advance notice bylaws adopted on a "clear day," which are currently pending. If these cases are decided before the submission window closes for the core 2025 proxy
season, they could have an impact on shareholder and proxy advisor engagement next year. Companies should monitor developments in this space, and consider whether bylaw updates are warranted in light of these developments.
4. Record Low Submissions on Independent Board Chair and Other Board Composition Proposals
Independent chair. The percentage of companies with an independent chair has been steadily increasing--38% of S&P 500 companies now have independent chairs, compared to 30% five years ago. The number of shareholder proposals on independent board chairs peaked in 2023, supplemented by engagement from "anti-ESG" proponents. This proxy season, total submissions dropped to half of the number in 2023, and proposals from "anti-ESG" proponents likewise decreased (three vs. eight in H1 2023). The rate at which proposals reached a vote and average shareholder support remained consistent with last year.
Board diversity. Since Nasdaq adopted its diversity rule in 2021, there has been a marked drop in board diversity proposals, with submissions on this topic falling into the single digits this proxy season. However, if the U.S. Court of Appeals for the Fifth Circuit overturns the Nasdaq rule, and in light of the increasing uncertainty associated with workforce DEI initiatives, it is possible that there could be a renewed interest in this area.22 Furthermore, according to the SEC's latest rulemaking agenda, it is slated to propose board diversity disclosure rules in April 2025, after repeated delays.
22 In 2018 and 2020, respectively, California introduced board diversity statutes, SB 826 and AB 979, which required a minimum board representation of women and members of underrepresented communities. Both laws were declared unconstitutional by California courts.
F. ENVIRONMENTAL PROPOSALS
Type of Proposal Climate
GHG Target Scope 3 Included Scope 3 Excluded/Unspecified Impact of Target
GHG Reporting Scope 3 Included Scope 3 Excluded/Unspecified Methane
Lobbying Financing Activity Misc. Climate Nature Plastics/Packaging Biodiversity Impact Assessment Deforestation Water Waste Misc. Nature Just Transition Board Oversight23 Supply Chain Sustainability Other Environmental
H1 2024 101 47 24 11 12 28 14 12 2 12 10 4 36 21
FY 2023 134 73 62 7 4 21 9 3 9 18 16 6 27 14
8 3 0 1 11 7 2 6
H1 2024 55 32 13 8 11 9 7 1 1 9 3 2 13 9
FY 2023 70 33 29 2 2 13 7 3 3 11 11 2 11 9
1 1 0 0 8 7 1 2
19% 23% 31%
2% 29% 20% 52% 16% 24% 26%
FY 2023 24% 13% 26% 13% 1% 32% 23% 21% 51% 32% 12% 7% 21% 24%
5% 8% -- -- 22%
H1 2024 2 1 0 1 0 1 0 1 0 0 0 0 0 0
FY 2023 2 0 0 0 0 1 0 0 1 1 0 0 0 0
0 0 0 0 0 0 0 0
Similar to social/political proposals, environmental submissions plateaued this year (170 vs. 171 in H1 2023) after significant year-over-year increases in prior years. Only 50% of these proposals reached a vote (similar to last year), the lowest across all categories. Average support decreased by a further four percentage points to 17% overall (compared to a high of 41% in 2021). However, as discussed below, GHG proposals that did not specifically include requirements related to Scope 3 (indirect value chain) emissions achieved meaningfully higher success when voted, resulting in the only two passing environmental proposals this year.
1. Decreased Industry Focus on Energy/Utilities Companies
Submission trends at energy/utilities companies. For the first time since we began tracking, companies in the energy/utilities sector were not the primary targets of environmental proposals. The consistent year-over-year industry focus was in part a result of engagement from investor initiatives like Climate Action 100+, which focus on emission reduction strategies at companies in high-emitting sectors. This past year, Climate Action 100+ faced significant scrutiny, and multiple large financial institutions
23 Although proposals related to board oversight of environmental/sustainability issues once again failed to gain traction, anecdotal evidence suggests investors and proxy advisors are becoming increasingly focused on this topic in their engagements with companies. Glass Lewis also updated its 2024 benchmark voting policies to state that it will review public companies for their levels of board oversight and accountability for environmental and social impacts as well as climate-related issues.
withdrew from or scaled back their participation in the initiative at the beginning of 2024.24 These developments contributed to both the overall decrease in climate-related submissions and a significantly lower concentration of environmental proposals in the energy/utilities sector. Last year, this sector received 32% of environmental proposals despite representing just 8% of the S&P Composite 1500. This year, the percentage in this sector dropped to 14%.
Focus on issues particularly relevant to consumer/retail sectors. Environmental proposals at consumer/retail companies more than doubled those at energy/utilities companies this year, in part due to a 45% increase in proposals on nature/biodiversity impacts and supply chain sustainability. Submissions to financial sector companies (18% of proposals in this category) also exceeded those to energy/utilities companies, driven by the New York City Comptroller and New York City Employees' Retirement Systems, who requested several financial institutions disclose their sustainable financing ratio.25
2. Shareholder Support Diverged Depending on Whether a Climate Proposal Included Scope 3
Overall trends for climate proposals. Consistent with previous years, the majority of environmental proposals (59%) focused on climate-related issues. The total number of climate-related submissions decreased by 25% (101 vs. 134 in FY 2023), and overall average support decreased by five percentage points. However, excluding voted proposals from "anti-ESG" proponents on the impacts of setting voluntary GHG reduction targets or other commitments--which increased by 550% year over year but received only 2% of votes cast on average--average support on this year's climate proposals was level with 2023 support at 21% of votes cast.
Engagement on target-setting vs. reporting proposals. For years, GHG target-setting and reporting proposals have been the most frequently submitted climate proposals, with target-setting proposals gradually surpassing reporting proposals in recent years.
24 On February 26, 2024, Climate Action 100+ announced that JP Morgan Asset Management, State Street Global Advisors and PIMCO had withdrawn from the initiative, while BlackRock had transferred its participation to BlackRock International. Both BlackRock and SSGA cited concerns with the enhanced requirements of Phase 2 of the initiative, which would require signatories to make "an overarching commitment to use client assets to pursue emissions reductions in investee companies through stewardship engagement." On the same day, the U.S. House of Representatives' Committee on Oversight Accountability sent a letter to the General Counsel of the Board of Governors of the Federal Reserve requesting additional information to aid its ongoing review of integration of ESG policies across the U.S. economy, citing concerns with financial institutions' participations in Climate Action 100+ and other ESG-focused alliances.
25 For H1 2024 annual general meetings, financial institutions received five proposals requesting disclosure of clean energy supply financing and/or sustainable financing ratios (i.e., an institution's financing for low-carbon or sustainable projects compared with their financing for fossil fuel projects). Three of these proposals reached a vote (at Bank of America, Citigroup and Goldman Sachs), receiving 26% shareholder support on average, with none passing. The other two proposals, submitted by the New York City Comptroller, were withdrawn at JPMorgan and Morgan Stanley.
GHG reporting proposals had been trending downwards as more companies voluntarily disclose GHG data. This year, they increased by 33%, likely as a result of emerging regulations mandating such disclosures in the near future, such as the law adopted by California in October 202326 and international requirements such as the EU's Corporate Sustainability Reporting Directive ("CSRD"). In contrast, perhaps as a result of increasing pressure from state attorneys general and "anti-ESG" groups, proposals on setting or enhancing voluntary emissions reduction targets decreased in 2024 by 36%.
Companies and proponents were also more willing to let target-setting proposals go to a vote than they were for GHG reporting proposals. Target-setting proposals went to a vote 68% of the time, whereas reporting proposals reached a vote for only 32% of submissions.
Treatment of Scope 3. This year, shareholders--both as proponents and voters--treated GHG proposals specifically referencing Scope 3 differently from those that did not.
Last year, John Chevedden and other proponents submitted similar target-setting proposals across a large number of companies, which asked companies to consider setting science-based targets for reducing emissions in their operations and across their full value chains. The number of target-setting proposals that included Scope 3 emissions decreased by 61% compared to 2023, while proposals that did not include Scope 3 increased by 57%. Similarly, for GHG reporting proposals, 2023 saw three times the number of proposals including Scope 3 compared to ones that did not, while 2024 submissions were much more evenly split.
For both GHG target-setting and reporting proposals, those that referenced Scope 3 emissions saw a three percentage point decline in average support, while those that did not reference Scope 3 saw significant year-over-year increases of 18 and 31 percentage points, respectively, with two gaining majority support.
These developments may reflect the impact of the SEC's climate-related disclosure rules, which were adopted in March 2024 before most companies held their 2024 annual meeting.27 Taking into account significant private-sector feedback on the challenges of Scope 3 reporting, the final rules eliminated the Scope 3 reporting requirements contained in the SEC's 2022 proposal, and will only require Scope 1 and/or Scope 2 reporting if material.
26 The law, SB 253, will require companies to publicly disclose their GHG emissions beginning in 2026. Even though the law is currently facing legal challenge, California has recently approved the budget for the implementation of the law. However, Governor Newsom has indicated that the initial reporting date could be delayed.
27 These rules immediately faced legal challenges. In April 2024, the SEC stayed the rules pending completion of judicial review of these legal challenges.
3. Increased Submissions on Nature-Related Topics Reflected Recent Global Momentum in This Area
Recent nature/biodiversity developments. In 2023, global efforts to address nature- and biodiversityrelated risks reached a milestone when 196 countries and other jurisdictions signed onto the KunmingMontreal Global Biodiversity Framework adopted during COP15, the UN's 2023 Biodiversity Conference. Throughout 2024, investors, standard-setters and EU lawmakers signaled a continued focus on biodiversity conservation and nature-related issues. The Council of the European Union formally adopted a nature restoration law that aims to restore 30% of the EU's land and sea by 2030, and all ecosystems in need of restoration by 2050. Principles for Responsible Investment announced in June 2024 that its nature-focused investor initiative, Spring (which aims to halt and reverse global biodiversity loss by 2030), will be engaging with an initial group of 60 focus companies on nature-related issues.
Furthermore, the Taskforce on Nature-related Financial Disclosures ("TNFD") released its recommendations for a nature-related disclosure framework in 2023, and has been working with the European Financial Reporting Advisory Group (the body responsible for creating disclosure standards under the CSRD) to align the two sets of standards. Earlier this year, the International Sustainability Standards Board, whose climate disclosure standard is being considered for adoption in jurisdictions representing 55% of global GDP, announced that it will be focused on biodiversity-related disclosures in the near term.
Proposal trends. Nature-related proposals increased by 33% year over year, accounting for 21% of all environmental proposals submitted in H1 2024, compared to 14% in 2023. Proposals ranged from water pollution to deforestation, waste and plastics. We also saw a new proposal, submitted at seven consumer/retail companies, requesting that the companies conduct biodiversity impact assessments.
In line with engagement in this area remaining at an "initial exploration" stage, proponents were willing to have an open dialogue with companies, withdrawing more than half these proposals (including the majority of the biodiversity impact assessment proposals and all the single-use plastics proposals) in 2024.
The voted proposals received 14% of votes cast on average, reflecting a seven percentage point decrease from 2023. Despite the lower support on voted proposals this year, we expect continued engagement between companies and investors in this area in the coming years, in light of growing interest from regulators, shareholders and other key stakeholders.
4. "Just Transition" Proposals Increased by 50% But Were Likely to Be Withdrawn
Submission trends. There were 16 proposals on the social impact of companies' environmental initiatives, targets and commitments (vs. 10 in H1 2023), including 10 requesting "just transition"28 reports. Teamsters and other unions continue to drive submissions in this area; one "anti-ESG" proponent, NLPC, also submitted a proposal in this area in 2024 (which was ultimately excluded).
Voting trends. Proponents and companies were more willing to negotiate these proposals than they were last year, when 80% of submissions went to a vote. Less than half of these proposals went to a vote in 2024. Support for voted proposals declined by three percentage points to 19%. Given these year's results, it remains to be seen whether unions will continue to submit shareholder proposals on this topic in the coming years.
G. COMPENSATION PROPOSALS
Clawbacks Compensation Environmental Compensation Social
Stock Retention Compensation Other29
FY 2023 49 4
FY 2023 43 3
3 5 6 9 5 3
H1 2024 15%
FY 2023 24% 37%
FY 2023 4 0
Last proxy season, there was a 60% increase in compensation proposals, driven by John Chevedden's "2.99x severance" proposal. This year, submissions increased by a more modest margin (by 5% to 79
total). Technology companies received a disproportionately high percentage (24%) of compensation
proposals, with the other sectors each receiving between 0% to 16% of submissions.
Severance continued to be the most prevalent topic--companies received 32 severance proposals (27 from John Chevedden). In the first proxy season after companies were required to adopt and disclose a clawback policy, the number of clawback proposals tripled. Proposals related to ESP-linked compensation metrics also increased.
28 The International Labour Organization defines "just transition" as "greening the economy in a way that is as fair and inclusive as possible to everyone concerned, creating decent work opportunities and leaving no one behind."
29 The "Compensation Other" proposals in 2024 included proposals to amend bylaws regarding stockholder approval of director compensation, proposals to improve executive compensation programs and proposals to optimize portfolio value for shareholders.
Approximately 76% of compensation proposals reached a vote, compared to 81% in H1 2023. The decrease in voted proposals is partly a result of the 75% success rate for no-action requests in this category. Companies were able to exclude 15 compensation proposals through the no-action process, including six on the "violation of law" basis. ISS supported only 30% of voted compensation proposals this year (vs. 48% in 2023 and 68% in 2022), almost all of which were severance or clawback proposals.30 Average support dropped to 14% (from 21% last year), continuing last year's downward trend after reaching a record high of 30% in H1 2022. No compensation proposals passed (vs. four in H1 2023 and three in H1 2022).
1. Continued Focus on Severance Proposals
Prior 2.99x severance proposals. Between 2021 and 2023, John Chevedden submitted over 50 proposals requesting that companies obtain shareholder approval for certain executive severance arrangements. Specifically, as proposed, shareholder approval would be required for any senior manager's new or renewed pay package that provides for severance or termination payments with an estimated value exceeding 2.99 times the sum of the executive's base salary plus target short-term bonus.31 All such proposals received over 30% of votes cast in 2021 and 2022, passing at FedEx (58% of votes cast) in 2021 and at Alaska Air (54%), Fiserv (51%) and AbbVie (50%) in 2022.
Encouraged by these results, John Chevedden submitted 37 of these proposals in the 2023 proxy season. However, the 2023 proposals generally received lower support (averaging 24% of votes cast) and passed at just four companies--Expeditors International (67%), Becton (62%), Delta (60%) and Resideo Technologies (50%).
30 In contrast, ISS supported 76% of compensation proposals in 2020, 52% of proposals in 2021, 68% in 2022 and 48% in 2023.
31 As drafted, these proposals include the value of both cash and equity awards, meaning that many companies' existing severance arrangements--especially in connection with an acceleration upon a change-in-control termination--will exceed the 2.99x threshold.
New version. This year, Chevedden reframed his prior 2.99x severance proposals to focus on severance packages for named executive officers,32 as opposed to senior management more generally. This tactic was unsuccessful, as shareholder support declined a further 10 percentage points compared to H1 2023, averaging 15% of votes cast. No such proposals passed.
2. Steep Increase in Clawback Policy Proposals New clawback rules. On October 26, 2022, the SEC adopted a rule directing national securities exchanges to require policies mandating the recovery of excess incentive-based compensation earned by a current or former executive during the three fiscal years preceding a required account restatement. On February 22, 2023, both NYSE and Nasdaq filed their listing standards, which directed listed companies to adopt a compliant policy by December 1, 2023 and to file such policies as an exhibit to their next annual report.
Submission trends. In the first proxy season following the required adoption and disclosure of a mandatory clawback policy, clawback proposals jumped from four proposals in H1 2023 to 12 in H1 2024. John Chevedden submitted nine of the 2024 proposals.
This year's proposals generally targeted companies that maintain both a NYSE- or Nasdaq-compliant clawback policy and a separate fault-based clawback policy, which permits the company to claw back compensation if there is misconduct. The proposals requested companies update their fault-based clawback policy to lower the bar for application, usually to "conduct or negligence" rather than misconduct or willful misconduct.
Voting trends. These proposals achieved low shareholder support. Voted proposals averaged only 17% of votes cast (vs. 42% in H1 2023), and none passed.
3. Divergent Proposals on ESP-Linked Compensation Submission trends. Since 2017, proponents have requested that companies adopt ESP-linked performance measures (e.g., diversity, social, sustainability and environmental impact) in their executive compensation. Between 2017 and 2022, ESP-linked compensation proposals became the most prevalent compensation proposals. Based on a study published in 2022, 73% of S&P 500 companies had already been using ESP-linked compensation metrics in 2021.33
32 Named executive officers are those for which compensation disclosure is required in a company's annual proxy pursuant to Item 402 of Regulation S-K.
33 See The Conference Board, Linking Executive Compensation to ESG Performance (Nov. 27, 2022), available at https://corpgov.law.harvard.edu/2022/11/27/linking-executive-compensation-to-esg-performance.
After a decrease in submissions last proxy season, submissions on this topic increased by 25% in H1 2024 compared to H1 2023. The majority of this year's submissions were environmental-based, focusing in particular on the link between compensation and climate-related goals.
Proposals to rescind adopted targets. For the first time, we saw proposals from "anti-ESG" proponents to rescind or reevaluate incentives linked to GHG targets (at three companies). The rescission proposals argued that "clear evidence [shows] climate alarmism is overstated," and climate-related incentive compensation is an "inefficient deployment of company resources."
Companies pushed back against these arguments by making counterarguments based on shareholder value. For example, Exxon stated in its proxy that its executive compensation program "is tied to a wide range of strategic objectives designed to drive sustainable growth in shareholder value while positioning the Company for long-term success in an uncertain future--including one with significantly lower emissions."
Voting trends. Excluding proposals from "anti-ESG" proponents, which received less than 2% of votes cast, average shareholder support for 2024 ESP-linked compensation proposals remained around 10%, consistent with last year. In light of these results and the current sensitivity around climate, diversity and other ESP topics, it is likely that the proponents most focused on this topic (social investment entities) will turn to private engagement with companies, as they did in the 2023 proxy season, in lieu of or in addition to the 14a-8 process.
H. EXCLUSIONARY RELIEF--SEC NO-ACTION AND BEYOND
Since the 2022 proxy season, when the SEC released Staff Legal Bulletin No. 14L and raised the bar for excluding proposals on the basis of "ordinary business," there has been significant turbulence on the noaction front. In the 2022 proxy season following the issuance of Staff Legal Bulletin No. 14L, there was a 46% decline in no-action success rates, driven by a 63% decrease in the likelihood of exclusion on the basis of "ordinary business." At the end of the core 2022 proxy season, the SEC proposed amendments to Rule 14a-8 that would further limit the availability of substantive bases for excluding proposals, specifically under the "substantial implementation," "duplication" and "resubmission" bases.34 These 2022 developments resulted in an overall hesitancy from companies in the 2023 proxy season to submit noaction requests to the SEC unless a proposal suffered from a procedural defect.
After a 26% decrease last year, no-action requests rebounded this year. Companies in the S&P Composite 1500 submitted 235 no-action requests (vs. 162 requests for H1 2023 proposals), representing a 45% increase. In particular, whereas the 2023 proxy season saw a 40% decrease in
34 The proposed amendments have not been finalized, with the scheduled adoption deadline continuing to be delayed (latest deadline set forth in the Regulatory Flexibility Agenda is April 2025).
requests on substantive bases, 2024 saw a 62% increase in requests that cited at least one substantive basis. The increase was more pronounced for requests that cited substantive bases that were not frequently used in prior years. As further discussed below, whereas requests citing the more typical "ordinary business" and "substantial implementation" bases increased by 45% and 38%, respectively, requests based on "violation of law" and "violation of proxy rules" increased by 338% and 140%, respectively.
As discussed in Section B, similar to the 2023 proxy season, companies requested to exclude proposals from "anti-ESG" proponents at a higher rate than for proposals from other proponents. However, whereas proposals by "anti-ESG" proponents were over twice as likely to be excluded relative to proposals from other proponents last proxy season, the success rate for no-action requests to exclude proposals by "anti-ESG" proponents decreased this proxy season to 41% (vs. 76% for H1 2023 proposals), lower than the success rate (74%) for other proposals.
As a response to the volatility in the SEC no-action landscape, Exxon filed a lawsuit in Texas federal court to exclude a proposal this year, as further discussed below. The commitments Exxon obtained from the proponent may encourage other companies to litigate Rule 14a-8 proposals if they have access to a receptive court, or at least threaten litigation to increase leverage in negotiations with proponents.
1. Increased Success with the SEC
The SEC granted 125 no-action requests with respect to H1 2024 proposals, compared to 71 for H1 2023 proposals and 65 for H1 2022 proposals. Overall, the SEC granted exclusionary relief on 67% of the requests that they considered, up from 54% for H1 2023 and 38% for H1 2022, nearly returning to the 70% success rate in the 2020 and 2021 proxy seasons.
One key driver for the increase in overall success rate was the significant increase in successful no-action requests on governance and compensation proposals (84% and 75%, respectively, vs. 61% and 60% for H1 2023). In particular, in both categories, companies successfully relied on the "violation of law" exclusionary basis, as further discussed below.
2. Increased Success on "Violation of Law" and "Ordinary Business" Bases No-action requests on the basis of "violation of law" increased by a notable amount, and was cited in 21% of proposals involving a substantive basis.35 There were 35 requests citing this basis (compared to eight for both the 2023 and 2022 proxy seasons). Of the requests that cited "violation of law" as a basis for relief, 22 were granted by the SEC on such basis (representing 18% of all no-action requests granted), and five were withdrawn because proponents withdrew after similar proposals were excluded through the
35 Half of the requests citing "violation of law" under Rule 14a-8(i)(2) also cited "absence of power/authority" under Rule 14a-8(i)(6).
no-action process. Among other requests citing this basis, companies successfully alleged "violation of law" to exclude 14 director resignation proposals as discussed in Section E, as well as six compensationrelated proposals requesting restrictions on companies' ability to determine director compensation. Such success on no-action relief was accompanied by withdrawals of similar proposals. For example, as the SEC began to grant no-action relief on requests to exclude director resignation bylaw proposals based on "violation of law," the carpenters unions withdrew eight director resignation bylaw proposals (including three proposals where a no-action request was pending and one proposal for which the SEC had denied no-action relief).
"Violation of proxy rules" was another historically less used basis that increased in prevalence this proxy season (by 140% compared to H1 2023). It was cited as a basis in 36 no-action requests, representing nearly 22% of all requests involving a substantive basis this proxy season. However, the SEC did not grant any relief on this basis in this proxy season.
Perhaps in response to increased success on this basis last proxy season, particularly in proposals related to employee matters, companies submitted 45% more no-action requests citing "ordinary business." The SEC granted no-action relief on the basis of "ordinary business" in 26 instances last proxy season. This year, that number has more than doubled to 56 instances, representing a 115% increase compared last year. The success rate on this basis increased from 48% to 69%. The SEC seems to be more amendable to arguments that shareholder proposals either relate to ordinary business or are seeking to micromanage companies to an indefensible extent, including in areas such as Scope 3 reporting, reporting on the feasibility of customized proxy voting and disclosure of directors' weekly allocation of their time.
3. SEC's Average Response Time Remains Around 70 Days
The threat of a government shutdown over the winter of 2023-2024 did not seem to have an impact on the SEC's response time. The average response time was 70 days (a median of 72 days), similar to the 2023 average of 68 days (with a median of 72 days) and the 2022 average and median of 71 days.
4. Exxon's Lawsuit to Exclude GHG Proposal
Mirroring the overall changes in the SEC no-action landscape, the SEC concurred with Exxon on all its unwithdrawn no-action requests in 2022 but declined to grant relief for all but one of Exxon's no-action requests in 2023. On January 21, 2024, facing a proposal requesting that Exxon set medium-term GHG emissions reduction targets for Scope 1, 2 and 3 emissions, Exxon filed a lawsuit against the two cofilers, U.S.-based Arjuna Capital and Netherlands-based Follow This. Instead of submitting a SEC noaction request to exclude this proposal, which Exxon did in response to seven other 2024 proposals, Exxon sought a declaratory judgment in the Northern District of Texas to exclude the proposal on the basis of "resubmission" and "ordinary business".
Exxon had received proposals from Arjuna and/or Follow This to set medium-term GHG targets for Scope 1, 2 and 3 emissions in 2022 and 2023. Exxon did not seek to exclude these proposals, and they obtained 27% and 10% of votes cast, respectively. Under the current version of Rule 14a-8(i)(12), companies can exclude a proposal that addresses "substantially the same subject matter" as a proposal voted on in the previous three years if the most recent vote received less than 5% of votes cast, or less than 15% of votes cast if previously voted twice. However, the SEC's 2022 proposed amendments to Rule 14a-8(i)(12) would narrow the current "substantially the same subject matter" standard to a more restrictive standard of "addresses the same subject matter and seeks the same objective by the same means." Exxon's complaint alluded to the possibility that the SEC could look beyond the "plain meaning" of the current "resubmission" standard to decline relief, since (1) the prior proposals use slightly different wording regarding how Exxon should set its medium-term GHG emissions targets and (2) the SEC's proposed standard not only requires the subject matter of a proposal to be the same, but also requires all essential elements of the proposal to be the same.
On February 2, 2024, Arjuna and Follow This withdrew their proposal. On May 22, 2024, the court ruled that Exxon could continue its lawsuit against Arjuna, but dismissed Exxon's claims against non-U.S. Follow This. Arjuna then filed a letter with the court, promising to refrain from submitting any future proposals to Exxon shareholders related to GHG emissions or climate change. Although Exxon argued that the case was not mooted by Arjuna's letter, the court disagreed and dismissed Exxon's lawsuit without prejudice on June 17, 2024.
Exxon's lawsuit attracted significant attention36 this proxy season because virtually all companies seek no-action relief through the SEC rather than through courts, even though there is no legal requirement to first request agency relief. In the early 2010s, there were a handful of cases brought in Texas federal courts where companies obtained declaratory relief to exclude Rule 14a-8 proposals.37 However, other courts declined to apply the reasoning in these cases. More recent lawsuits relating to the Rule 14a-8 process have been filed against the SEC rather than proponents. For example, during the 2023 proxy season, NCPPR sued the SEC after the staff granted Kroger's request to exclude NCPPR's proposal, and obtained an emergency stay from the Fifth Circuit. It remains to be seen whether there will be more
36 For example, on May 20, 2024, CalPERS published an open letter noting that it would vote against Exxon's entire slate of directors at the company's annual meeting, stating that the lawsuit, if successful, "could diminish the role--and the rights--of every investor in improving a company's bottom line." For similar reasons, on May 21, 2024, a group of U.S. treasurers, comptrollers and pension plan trustees, including the New York City Comptroller, also filed a notice of exempt solicitation urging investors to vote against Exxon's lead independent director and CEO.
37 See, e.g., Apache Corp. v. Chevedden, 696 F. Supp. 2d 723 (S.D. Tex. 2010); Waste Connections Inc. v. Chevedden, 554 F. App'x 334, [2013 2014 Transfer Binder] Fed. Sec. L. Rep. (CCH) 97,819 (5th Cir. 2014); Express Scripts v. Chevedden, 2014 WL 631538, [2013 2014 Transfer Binder] Fed. Sec. L. Rep. (CCH) 97,823 (E.D. Mo. 2014).
litigation to exclude shareholder proposals in the future, but given the outcome of the Exxon lawsuit, some proponents might view a credible threat of litigation as a deterrent from taking a hardline approach.
I. EXEMPT SOLICITATION
Exempt solicitation notice filings with the SEC continued their upward trend in 2024, as proponents increasingly leveraged such filings to generate publicity for their proposals ahead of annual shareholder meetings. While only shareholders owning more than $5 million of a company's securities are required to file a Notice of Exempt Solicitation under Exchange Act Rule 14a-6(g), these filings have been used to a greater extent by smaller shareholders to voice their opinions and gather support for proposals. In H1 2024, there were a record-high 375 exempt solicitation notices filed (up from 355 in H1 2023), with voluntary submissions accounting for a substantial majority of filings, consistent with recent years. Frequent filers of exempt solicitation notices included As You Sow (46 filings), Bowyer Research (40 filings) and John Chevedden (28 filings), as well as "anti-ESG" proponents NLPC (23 filings) and Inspire Investing (22 filings).
J. PROXY ADVISORY FIRM REQUIREMENTS
In 2020, the SEC adopted requirements on proxy advisory firms, such as ISS and Glass Lewis, to (1) make proxy voting advice about a company available to the company in advance of or concurrently with disseminating it to their clients and (2) have a mechanism for making clients aware of the company's response statement before they vote. In 2022, the SEC adopted amendments to remove these noticeand-awareness requirements. On June 26, 2024, the U.S. Court of Appeals for the Fifth Circuit vacated and remanded the SEC's rescission of these requirements. The court ruled in National Association of Manufacturers et al. v. SEC that the SEC acted arbitrarily and capriciously in removing these requirements, and therefore violated the Administrative Procedure Act. The U.S. Chamber of Commerce, the Business Roundtable and the Tennessee Chamber of Commerce & Industry also challenged the 2022 amendments in a case pending before the U.S. Court of Appeals for the Sixth Circuit.
Unless the Sixth Circuit reaches a different conclusion, companies and investors should expect the notice-and-awareness requirements to be reinstated. We expect that these developments will impact proxy advisory firm practices and proxy season engagement in future proxy seasons.
K. MEETING PROCEDURE
In light of the COVID-19 pandemic and government-mandated health and safety protocols, many companies turned to virtual annual shareholder meetings.38 Since then, some companies have shifted back to either in-person or hybrid meetings, though virtual annual meetings remain common. On the one
38 A March 2023 study published in the Washington and Lee Law Review found that among corporations with revenue of $100 billion and above, 97% reported hosting their annual meeting virtually in 2021.
hand, some shareholder advocates argue that virtual meetings increase the accessibility of such meetings, thereby increasing the likelihood that shareholders will attend and engage. On the other hand, critics view the use of virtual annual meetings as an attempt for companies to avoid shareholder scrutiny and undermine the importance of the matters to be acted upon, for example, by limiting the ability of shareholders in attendance to ask questions in real time.
As discussed last year, a number of companies faced lengthy and disruptive protests at their annual meetings. This year, some companies viewed virtual meetings as a means to avoid such disruption. For example, the Chief Executive Officer of Barrick Gold noted in May that he "can't see any reason" to return to in-person annual meetings after the company had been subject to prior annual meeting interruptions from protestors.39
Companies should continue to assess meeting protocols to ensure continued efficacy of virtual meetings, to the extent used, and monitor to shareholder engagement, including with respect to ensuring safety and orderly conduct at annual meetings.
39 Bloomberg, Barrick CEO `Can't See Any Reason' for In-Person Annual Meetings (May 1, 2024), available at https://www.bloomberg.com/news/articles/2024-05-01/barrick-ceo-can-t-see-any-reason-for-in-person-annualmeetings.
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IMAGES
COMMENTS
Pollution prevention is the current environmental strategy to minimize pollution problems. It is a management strategy to establish a society-oriented approach towards sustainable development.
Finding and choosing a strong research topic is the critical first step when it comes to crafting a high-quality dissertation, thesis or research project. Here, we'll explore a variety research ideas and topic thought-starters related to various environmental science disciplines, including ecology, oceanography, hydrology, geology, soil science, environmental chemistry, environmental ...
Check out these environmental topics for research paper to produce an engaging proposal. 1. Consequences of Climate Change Human Societies. 2. Challenges of Renewable Energy Technologies. 3. Recycling Initiatives and Their Implications on Reducing Pollution. 4. Challenges of Sustainable Management of Freshwater Resources.
PDF | On Mar 11, 2020, Fredrick Ahenkora Boamah published PhD RESEARCH PROPOSAL (ENVIRONMENT) Topic Sustainable urbanization in Ghana: The role of integrated land use planning | Find, read and ...
The Natural Resources Institute (NRI) at the University of Manitoba offers Master's and Ph.D. degrees in resource and environmental management. It was established in 1968 as a degree-granting, interdisciplinary unit with a threefold purpose, namely: (a) to teach management skills leading to a graduate degree of Master of Natural Resources ...
Microsoft Word - Sustainability proposal_Jan2016_Keough.docx. Proposal for a. Thesis in the Field of. Sustainability and Environmental Management. In Partial Fulfillment of the Requirements. For a Master of Liberal Arts (ALM) degree in extension studies. Harvard University. Extension School. February 15, 2016.
John Hart-Smith. Master of Science in Environmental Science and Policy Candidate, May 2012. t Sedge Wetland in a Piedmont River ValleyProject Advisor: William HilgartnerINTRODUCTION Dark, organic layers containing fossil seeds of sedges and other obligate wetland species have been recovered from the base of numerous river banks in the Piedmont ...
Proposal Format & Content. Download a PDF of this format and content information . Project proposals are limited to three pages (excluding references, budget and justification, and client letter of support).. Title, descriptive of the environmental science and management problem to be solved.; Identification. Name and contact information (email, phone, and affiliation) of the proposer(s).
This Collection provides a unique combination of futuristic research works in the areas of Solid Waste Management, Wastewater Management, Air Pollution, Environmental Engineering, Climate Change, Energy Sciences, Water Resources, GIS, Remote sensing and Geo-informatics, Biotechnology, Nanomaterials, Infrastructure Design, Construction Materials and Concrete Technology.
A Review and Proposal for More Integrated Research . ... research on the CG of environmental sustainability has mostly shied away . ... symbolic environmental management practices, or how CEO and ...
Synthesis science proposals and working groups will cover three main areas of research for decision making in the Gulf of Mexico: fisheries, climate change, and the ecological impacts of management. The Initiative's annual call for proposals yields 2-3 working groups funded at approximately $75,000 - $125,000 to convene their teams and conduct ...
Key Component #1: Thorough and well-written. This goes without saying: the base point for receiving any program funding rests on a thorough and well-written grant proposal. Project scope thoroughness is usually attainable from researchers because they know their project inside and out. However, thoroughness regrading proposal requirements and ...
Environmental management research in hospitality - Author: Eric S.W. Chan, Cathy H.C. Hsu. The purpose of this paper is to review and synthesise 149 hospitality-related studies published in the past two decades pertaining to environmental management (EM). The review was divided into three main stages: 1993-1999, 2000-2009 and 2010-2014 and ...
Research proposal examples. Writing a research proposal can be quite challenging, but a good starting point could be to look at some examples. We've included a few for you below. Example research proposal #1: "A Conceptual Framework for Scheduling Constraint Management".
EREF is one of the largest sources of private research funding in North America related to sustainable materials management. Our grants program has provided millions of dollars in funding to cutting edge research institutions to help address the many challenges that exist. The process for grant consideration involves the submission of a 2-page ...
Forest Ecology Research Proposal: UW-SU Exchange on Environmental Issues. Introduction: In recent years the importance of environmental protection has been brought to the forefront of Chinese policy making. As a result, new policies have been drafted affecting many different aspects of environmental protection in China.
For its part environmental education is becoming well established in nonprofit organizations, public agencies, schools, colleges, and universities. The words "environmental education," however, imply education about the environment, just another course or two, a curricular outbuilding to the big house of formal schooling where the really ...
They were normally treated as separate entities. Fekade (2000) stated that the existing urban management policies and practices are ill-prepared to meet the ever increasing demand for shelter and livable environment in the 21st century. Majority of the environmental problems are connected to rapid urbanization.
Before conducting a study, a research proposal should be created that outlines researchers' plans and methodology and is submitted to the concerned evaluating organization or person. Creating a research proposal is an important step to ensure that researchers are on track and are moving forward as intended. A research proposal can be defined as a detailed plan or blueprint for the proposed ...
address the issue of waste management as a basis for preserving ecosystems. This paper states the. management of recyclable and non-recyclable solid waste generat ed by 19,032 people on the ...
Title : Call for Proposals - Systemic Drivers of Food Loss and Waste in the United States Project objective: To identify unique systemic drivers of food loss and waste in the United States and recommend strategies to address these unique drivers. Project background: UNEP, as custodian of SDG 12.3 indicator the Food Waste Index and mandated by UNEA Resolution 4/2, is working with governments ...
Step 3: Outline the Proposed Plans and Strategies. The next step is a crucial section in your project proposal. After providing a thorough analysis of the environmental problem or issue at hand, you need to draft concrete and attainable plans that will directly address your project's objectives.
Ph.D Research Proposal: Environmental Policy and Management . Title: Assessing Community Resilience in Mediterranean Region . Christos Giannoulis . Introduction . Human populations are concentrated along coasts, and consequently coastal ecosystems are some of the most impacted and altered worldwide. These areas are also sensitive to many ...
An assessment of the occurrence and removal options of microplastics in wastewater treatment processes at the City Ekurhuleni and Midvaal in South Africa. Mphaga, Tendani (2023-03-03) The main aim of the study was to investigate the occurrence and removal of microplastics in wastewater treatment processes in Ekurhuleni and Midvaal in South Africa.
Submissions continued to increase in terms of both absolute numbers and in the number of companies with a proposal on the ballot...