IMPACT INVESTING 2021/Q4 - Page 7

From a fiduciary perspective, Director accountability is a key part of practicing impactful governance. During the 2021 proxy season, we saw an uptick in shareholder support for ESG-focused proposals and an increase in the impact of shareholders making adverse voting decisions against directors for failure to resolve ESG issues.

 

Corporate cultures in which employees mention innovation have tended to be more profitable (higher ROA) and retain workers (lower turnover).

Increased Accountability

ESG-Oriented Strategies on Pace to Be a Third of Global AUM by 2025

Source: Bloomberg. As of 12/31/2021.

Primary Campaign Objectives in 2021

Most Common Drivers of Majority Opposition to Directors

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Source: BlackRock, GlassLewis. As of 12/31/21.

Activists Are Focusing on Corporate Governance

2021 was marked by numerous high-profile successes by activists at global companies (e.g. Exxon Mobile/Engine No.1). Activism at U.S.-based companies overall increased moderately relative to 2020, as managers have largely sustained campaign levels throughout the COVID-19 pandemic.

 

Corporate cultures in which employees mention innovation have tended to be more profitable (higher ROA) and retain workers (lower turnover).

Source: Activist Insight and FactSet. As of 1/23/22