We’re coming to the end of ‘off season’ – when many companies go out on the road to engage with key institutional investors ahead of their annual shareholder meeting.
According to a recent IR Magazine survey, around two thirds of IR teams say they have a program of activities focused on governance issues away from AGM season.
It’s a practice that has increased as investors have taken a growing interest in ESG issues, offering the chance for senior management – and in some cases board members – to interact directly with major holders on key topics.
The themes that investors want to discuss, however, have shift significantly over the last year as ESG and corporate sustainability have come under fire from different quarters.
For example, some US investors that used to want to talk about diversity – and even threatened action over it – now have no interest in discussing the topic, report companies.
That’s hardly surprising, given the negative attention on diversity, equity and inclusion (DE&I) programs in the US, which has led many businesses to cancel them.
It leaves companies that have made certain ESG issues a key part of their narrative in a bind – do you keep talking about these subjects, given the risk of becoming a target of anti-ESG or anti-DE&I activists?
Another issue is how to manage diverging views within the shareholder base. While US investors are parring back their focus on ESG, the situation is different in other markets.
Just this week, Fidelity International released a survey of 120 institutional investors and intermediary distributors based in Europe and Asia.
More than half of the respondents say they still consider ESG factors as ‘important when it comes to portfolio asset allocation over the next 18 months.’
For public companies, working out how to discuss sustainability as we head towards the 2025 AGM season is still proving a thorny topic.
Have you had discussions on this issue at your business? How have your investors’ opinions on sustainability and other ESG matters changed? Get in touch and let us know via [email protected] or on LinkedIn.
