Dive Brief:
- Vanguard, the world's second-largest asset manager, reported last week that it supported no environmental or social shareholder proposals at U.S. portfolio companies during the most recent proxy season.
- Vanguard made the disclosure in its U.S. regional investment stewardship brief last week and said it analyzed and voted against 261 environmental and social proposals at portfolio companies, down from 400 such proposals submitted in the 2024 proxy season.
- This is the second consecutive year that Vanguard declined to support any environmental or social shareholder proposals at U.S. companies. The firm supported just 2% of such proposals in the 2023 proxy season.
Dive Insight:
Vanguard’s disclosure comes after a proxy season where support for environmental and social proposals fell for the fourth consecutive year and overall shareholder proposals declined year over year. The number of shareholder submissions had increased each proxy season since 2020, but The Conference Board said in an Aug. 31 analysis that 781 shareholder proposals were filed at Russell 3000 companies in the most recent season, down from 932 proposals in 2024.
S&P 1500 companies voted on 149 environmental and social proposals in 2025 — a 45% decrease year over year — according to Ernst & Young. Average support for those proposals was just 14%, according to EY, as support continues to fall from a 2021 high of 33.3%.
Vanguard attributed the decrease in environmental and social submissions to factors including the Trump administration's Securities and Exchange Commission altering its approach to the no-action process and what qualifies for exclusion. The firm also attributed the drop to submissions being withdrawn, typically after company engagement, and “certain proponents increasing or decreasing their submissions.”
“In the 2025 proxy year, we witnessed many companies that had previously received a significant number of shareholder proposals seeing a sizable decrease in that number,” Vanguard said in its Aug. 27 brief.
Vanguard voted on 82 environmental-related shareholder proposals at portfolio companies in 2025, down from 107 the year prior, that “typically requested that companies disclose greenhouse gas emissions, climate-related financial risks and strategies for achieving net-zero targets,” according to the report. The report also noted new environmental proposal topics around “climate-driven insurance impacts,” biodiversity loss, supply chain sustainability and concerns around deep sea mining.
The asset manager said human rights and labor practices, political contributions and lobbying disclosures and DEI were topics of social-related shareholder proposals at companies across sectors. The consumer goods industry received the largest share of social proposals, while the tech sector received proposals regarding artificial intelligence disclosure and governance practices, according to the investment stewardship brief.
Vanguard also reported witnessing a continued increase in anti-ESG proposals — which drove an overall rise in submissions in 2024 — that the asset manager described as “proposals that sought to reverse or rebuke a company’s approaches to climate change risks, sustainability, or a range of social issues.”
The firm said it evaluated each of the environmental and social proposals at its portfolio companies based on “the context of the facts and circumstances at each company,” and concluded that “in many cases, [the] proposals did not address financially material risks to shareholders at the companies in question or were overly prescriptive in their requests — including, for example, proposals calling for specific GHG emissions targets.” The firm said there were other instances where it “did not identify a gap” in the company’s practices or disclosures that would be addressed by the particular proposal.
The language closely mirrors Vanguard’s findings after it declined to support any environmental or social proposals in 2024. The firm attributed its lack of support during the 2024 proxy season to it not identifying a gap in policies or disclosures addressed, as well as the proposals put before portfolio companies being “overly prescriptive in their requests” or “not address[ing] financially material risks to shareholders at the companies in question.”
