This year’s proxy season saw fewer proposals reaching US ballots, amidst a greater emphasis on negotiation, regulation, and strategic engagement. Governance was reasserted as the central focus in North American and European markets, while support for environmental and social proposals continued to soften, especially in the US. Voting outcomes have become less predictable as investors in both regions are moving towards company-specific decisions, elevating the importance of disclosure quality and company responsiveness.
Votes against the re-election of relevant directors may be considered at companies where there is evidence of insufficient management of environmental opportunities and risks. We apply region and sector-specific guidelines and various relevant climate risk indicators based on each client’s policy. Support for shareholder proposals is considered where appropriate, including proposals to support a company’s climate transition plan, where the expected outcome of the proposal would align with the long-term financial interests of the company.
At Nordea and Danske Bank, we saw several climate-related shareholder proposals relating to the banks’ exposures and policies on fossil fuels. Whilst our clients’ policies generally support credible transition planning across the sector, the proposals were considered overly prescriptive and may have gone beyond Paris Agreement-aligned scenarios.
In Australia, we applied voting against the remuneration items at Woodside Energy in line with our clients’ policies, due to concerns related to the company’s transition planning and associated capital discipline. Woodside had introduced a return on average capital employed metric to the long-term incentives, but this appeared to be insufficiently stretching, furthering capital discipline concerns, and possibly leading to long-term financial underperformance.
At BP, our clients’ policies indicated a vote against the revocation of two previous shareholder-approved climate resolutions. This was due to concerns that their revocation would reduce transparency of BP’s long-term financial resilience, transition strategy, and capital allocation, to the detriment of long-term value creation.
Regulatory expectations concerning human rights are increasing, but operational and reputational risks stemming from poor management of this issue persist.
Human rights in high-risk regions
Our clients believe that a company’s human rights strategy is of critical importance for its licence to operate, its impact on people’s lives, and its ability to create and preserve long-term holistic value. Regulatory expectations concerning human rights are increasing, with the introduction of the EU’s Corporate Sustainability Due Diligence Directive and the US Uyghur Forced Labor Prevention Act. Operational and reputational risks stemming from poor management of this issue persist, which may cause business disruption, litigation or other financial impacts.
Taking all this into consideration, our clients’ human rights voting policy indicates votes against directors if there is sufficient evidence that a company has caused or contributed to egregious, adverse human rights impacts or controversies and has failed to provide the appropriate remedy.
A wide range of US companies received shareholder proposals related to human rights in high-risk regions, but the technology sector was in focus. Support for such proposals was determined on a case-by-case basis, as some were overly prescriptive or lacked clear financial relevance. However, we continue to engage with companies on effectively managing human rights issues that are material to their business, including those in high-risk geographies.
Executive pay
In Germany, we continued to see several structural pay concerns. In this market, many companies rely on relative total shareholder return as a primary long-term incentive metric, with designs that allow vesting below median performance or full vesting at the median. This effectively rewards underperformance granting full payouts for merely matching peers rather than outperforming them. We also continued to observe comparatively low shareholding requirements for executives, particularly when compared with the UK and other European markets, limiting alignment between management and long-term shareholder interests.
In the UK, companies continue to shift towards time-restricted share plans or hybrid structures that combine performance and time-based elements. This approach may be justified for companies with significant exposure to global markets, particularly the US, where talent attraction and retention are key considerations. But for others, the rationale is less persuasive.
To find out more, read the full article in our Q2 2026 Public Engagement Report.
Twin-tracks persist in 2026 vote season
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