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Aussie opposition to climate resolutions doubles global average

By Jessica Penny
3 minute read

Georgeson’s 2023 AGM Intelligence Report has revealed that Australian shareholders’ opposition to climate-related resolutions was higher than the global average.

The report has revealed that in 2022, across ASX 300 companies, shareholder opposition to Say on Climate experienced, on average, nearly 25 per cent shareholder opposition, which is more than double the average global opposition of 9.6 per cent. 

This, according to the report, could signify a lower level of ESG disclosures by Australian companies compared to those in Europe and the US.

The Say on Climate initiative was launched in late 2020 with the aim of urging listed companies to create and execute Paris-aligned transition plans. Annual shareholder votes would provide increased accountability against those plans, according to the mechanism’s objectives. 

According to the report, companies globally proved to still be wary of allowing shareholders votes on Say on Climate resolutions, with many preferring to agree to non-binding resolutions instead. 

Namely, data from the UN Principles of Responsible Investment showed that of 576 ESG-focused resolutions in 2022, fewer than 100 were Say on Climate.

Georgeson’s findings indicate that only a small number of ASX 300 companies are including climate plan-related resolutions at their AGMs. Specifically, the report found that out of the ASX 300, only eight companies — including AGL Energy Limited, APA Group, Origin, Rio Tinto, Santos, Sims Metal, South32, and Woodside — included such resolutions in 2022, all of which were passed with support ranging from 51 per cent to 94.5 per cent.

Conversely, the data revealed that remuneration at Australia’s largest 300 companies received increased shareholder support, with 22 per cent fewer companies receiving strikes — over 25 per cent of “against” votes. 

Commenting on the findings, Andrew Thain, country head and managing director of Australia at Georgeson, said: “The increased remuneration support indicates companies continue to engage in robust stakeholder discussions throughout the year, helping their investors better understand the metrics and reasoning behind their compensation plans.

“On the other hand, the continued high levels of opposition to Say on Climate resolutions suggests investors are seeking more meaningful ESG-related disclosures, particularly around climate change. 

“Shareholders continue to use their votes to express their dissatisfaction and expect companies to step up their ESG practices and reporting.”

Also exploring the number of female directors on board, Georgeson revealed that female directors now hold 35.7 per cent of ASX 200 director positions — a notable increase from the previous year’s 34.9 per cent. 

The report also highlighted that nearly half of the new director appointments to ASX 200 boards were women, demonstrating a strong commitment towards diversity in corporate leadership.

However, despite these strides, the report indicated that there is still work to be done. Shockingly, women only account for a mere 10 per cent of all ASX 200 and ASX 300 chair positions, while four ASX 200 companies still have zero female directors.