Monthly Roundup – May 2022
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Latest Georgeson publications
Global: Georgeson 2022 Global Institutional Investor ESG Insights
ESG matters are top of mind for issuers and investors everywhere. In this complex and constantly evolving landscape, understanding how your top shareholders view these can be challenging. Georgeson interviewed 20 top institutional investors in the US, UK and Europe representing $30.5 trillion in AUM to discuss their ESG positions and methods.
Europe & UK: Georgeson 2022 Say on Climate Board Proposals

Georgeson has issued a client memo covering Say on Climate board proposals from January to mid-May 2022.

US: Georgeson Publishes the Top 5 ESG Trends to Watch in 2022 and Beyond

“In the span of a few years, the ESG (Environmental, Social and Governance) landscape has changed dramatically, both from the investor and issuer perspectives. It has had an increasingly significant impact on companies around the world, with many institutional investors now considering oversight and management of material issues to be table stakes. With the focus on ESG continuing to increase at a rapid clip, the top five trends we have our eye on in 2022 follow…”

Georgeson in the media
Global: Georgeson’s Hannah Orowitz and Daniele Vitale wrote about ESG in 2022 in the Ethical Boardroom’s Spring Edition

“Shareholders have increasingly held companies accountable for not sufficiently disclosing or demonstrating progress on a range of environmental, social and governance (ESG) issues in the past few years. Following the unprecedented support for environmental and social (E&S) shareholder proposals in 2021 and the successful unseating of directors by activists as a result of E&S concerns, ESG-related shareholders and board resolutions are at the top of investor’s agendas for the 2022 annual general meeting (AGM) season.”
US: Georgeson’s Hannah Orowitz is quoted in the ABA Banking Journal’s article titled “Prepare for investors’ questions on diversity”

"During proxy season—the period from mid-April to mid-June when most public companies hold their annual meetings—investors are expected to remain highly focused on two issues: diversity and climate, according to Hannah Orowitz, senior managing director for corporate governance at Georgeson.”
Europe: Georgeson’s Cas Sydorowitz wrote about Emerging Trends: Political Activism Converges with ESG in Insightia’s report on Shareholder Activism in Europe 2022.

"In a globalized, digital world, shareholders are empowered to voice opposition to company actions that they perceive to create reputational or financial risk – and use votes or even the threat of divestiture to hold companies accountable. Now, political activism appears to be an emerging lever for investors of all types."
US: Georgeson’s Kilian Moote and Hannah Orowitz were quoted in Insightia Monthly’s May Issue titled “The Racial Audit Revolution”

“Generally speaking, directors are well-qualified to advise on core business matters, but do not have civil rights expertise or a deep understanding of matters such as unintentional biases that may be influencing decisionmaking,” Kilian Moote, managing director at Georgeson, told Insightia in an interview. “These audits aim to have  an independent assessment of companies’ practices by individuals with civil rights or racial justice expertise.”
Georgeson Events
US: Georgeson’s Hannah Orowitz and Don Cassidy together with Latham & Watkins LLP will discuss the 2022 Proxy Season: Lessons Learned and Coming Attractions on June 14

The final 60-minute program of the three-part proxy season webcast series will cover the following topics: SEC updates and 2022 expectations; Executive compensation: 2022 proxy season review and looking ahead; Evolving trends in shareholder engagement; and, Shareholder proposals and voting results.
Spain: Georgeson will present the 7th Edition of its ESG Investment Observatory on June 16

In the presentation, the results of the study will be announced with the participation of PwC, Russell Reynolds, BBVA and S2 Grupo, whose objective is to identify the main trends in the matter and make a background of the main demands of institutional investors in the social field. and environmental.
Italy: Georgeson’s Francesco Surace will be presenting at the ESG Business Conference hosted by ETicaNews on June 15

Is the ESG value only about the company? Or is it intrinsically linked to the relationships it establishes outside its perimeter? In other words, talking about a company's ESG identity cannot be separated from also questioning its 'extended' ESG Identity, i.e. the importance of the company's relationships in terms of shared value, dual materiality, product and relations with the supply chain, upstream and downstream: the 'relational ESG Identity'. With this in mind, the theme of the new ESG Business Conference (registered here) is precisely "The ESG Value Chain", a frontier theme identified by the ETicaNews Research Department and also characterising the thematic area (extraordinary survey) of the 2022 edition of the Integrated Governance Index (IGI).
Bulgaria: Georgeson’s Daniele Vitale presented at a conference hosted by the Association of Bulgarian Investor Relations Directors (ABIRD) 

Daniele Vitale, our Head of Governance for the UK & Europe, spoke at the conference about the European AGM trends in recent years and the rise of climate related resolutions.   
Shareholder Activism
Environmental & Social
European developments
  • Bloomberg reports that ECB Splinters Over Right to Police Banks’ Path to Net-Zero: “A divergence of opinion is forming among Europe’s top banking regulators which could weaken efforts to prepare the financial sector for climate change, according to people familiar with the matter. The European Central Bank is poised to get the power to oversee so-called transition plans by 2025, in which lenders map out their path to a carbon-neutral future. Yet several national officials who sit on the ECB’s supervisory board are sceptical that climate risks merit new rules, and some are wary that the initiative exceeds the central bank’s mandate, said the people, who asked to remain anonymous because their discussions are private.”
North America
United States
  • The Wall Street Journal reports how the SEC Proposes More Disclosure Requirements for ESG Funds: “Agency votes to float plans to give investors more information on environmental, social and corporate-governance vehicles.” See the SEC announcement here.
  • The Securities and Exchange Commission announces that it Extends Comment Period for Proposed Rules on Climate-Related Disclosures: “‘Today, the Commission acted to provide the public with additional time to comment on three proposed rulemakings that have drawn significant interest from a wide breadth of investors, issuers, market participants, and other stakeholders,’ said SEC Chair Gary Gensler. ‘The SEC benefits greatly from hearing from the public on proposed regulatory changes. Commenters with diverse views have noted that they would benefit from additional time to review these three proposals, and I'm pleased that the public will have additional time to provide thoughtful feedback.’”
  • The Wall Street Journal reports that Lawmakers Seek to Curb Voting Power of BlackRock, Vanguard and Other Big Asset Managers: “Expected GOP bill would require large money managers to give passive-fund investors a way to vote proxies.”
  • ISS writes that May 19 to Mark Peak U.S. Corporate Annual Meeting Date: “Nearly 40 percent of all Russell 3000 companies will hold their annual meeting in May, including 237 constituents of the large-capital S&P 500, according to an ICS analysis of U.S. proxy filings through May 6. The peak day of May 19 will see 119 meetings scheduled for companies across industries, including household names such as AT&T, AvalonBay Communities, The Cheesecake Factory, Discover Financial Services, Dropbox, Home Depot, JetBlue Airways, and Western Union. The next busiest days for U.S. annual meetings will be May 18 and May 26 when 115 Russell 3000 companies convene their shareholders on each of those days, followed by May 25 when 106 firms will hold meetings.”
  • The Deal reports Delaware Weighs In On Director Independence: “In his May 2 decision, Glasscock surveyed the recent case law on director independence in a variety of contexts, which as a whole ‘crystallizes the importance of assessing independence in a precise factual context,’ he wrote. ‘Successfully impugning a director’s independence with respect to voting on transactions should be more difficult than challenging that same independence with respect to assessing a demand,’ he continued.”
  • reports SEC Chair Requests More Resources: “In his remarks, Gensler noted that the Division of Corporation Finance has shrunk a whopping 19% since 2016. Over that same period, the Division’s workload has grown. Gensler notes that in fiscal year 2016, Corp Fin reviewed filings related to approximately 510 new registrants, while that grew almost fourfold last year, to 1,960.”
  • The Wall Street Journal reports that Investors Protest Executive Pay at JPMorgan, Intel and Coca-Cola: “Nonbinding ‘say on pay’ votes against compensation packages for chief executives are aimed at influencing board decisions.”
  • Bloomberg reports on SEC Judges’ Constitutional Cloud Darkens After Appeal Ruling: “The Fifth Circuit darkened the legal cloud over the SEC’s use of in-house judges to hear cases, saying Wednesday the system violated a hedge fund manager’s constitutional right to a jury trial in federal court.  Congress’ delegation of legislative power to the Securities and Exchange Commission was unconstitutional because it failed to “provide an intelligible principle by which the SEC would exercise the delegated power,” the US Court of Appeals for the Fifth Circuit said in a 2-1 opinion.”
  • The Wall Street Journal reports that Judge Strikes Down California Law Mandating Women on Boards: “Decision follows a similar ruling last month on a separate law requiring racial or ethnic diversity on boards.”
  • Reuters reports that Top Wall Street firms, Ford to disclose directors' race and gender: “Four top Wall Street firms and Ford Motor Co will start to disclose the race and gender of individual directors under deals reached with New York City pension officials, the city's comptroller, Brad Lander, said on Thursday, while a utility company has pushed back on the idea.”
Hong Kong
  • The South China Morning Post reports that HSBC sets aside US$5 billion in sustainable financing to fund projects in the Greater Bay Area to reduce carbon emissions: “HSBC has launched a US$5 billion sustainable finance scheme to support companies in the Greater Bay Area (GBA) that are aiming to lower their carbon emissions. The bank’s GBA Sustainability Fund, which runs for 18 months, will accept applications from companies of all sizes based in the southern China megalopolis of 11 cities that engage in activities to lower their carbon emissions, according to a statement on 17 May 2022. These include manufacturers and real estate developers involved in sectors such as climate change adaptation, pollution prevention, wastewater management, clean transportation, renewable energy, sustainable water resources and others, the bank said. Emerging climate technology businesses that are at a pre-profit stage will also be eligible for the scheme.“HSBC is dialling up all-round support for businesses of all sizes to transition towards low carbon operations,” said Frank Fang, general manager and head of commercial banking in Hong Kong and Macau at HSBC.”
  • The Asset reports that ESG disclosure with Chinese characteristics ready: “The China Enterprise Reform and Development Society (CERDS), Ping An Insurance Company of China and dozens of other companies in the country have developed its first environmental, social and governance (ESG) disclosure standards, which come into effect June 1. The Guidance for Enterprise ESG Disclosure, which was published by CERDS, is based on relevant Chinese laws, regulations and standards while considering China's context. It includes a corporate disclosure indicator system with three dimensions – environmental, social and governance – and provides a basic framework for their disclosure. The guidance also specifies disclosure principles, indicators, requirements, applications, responsibilities and supervision for enterprises of different types, industries and sizes. It can support Chinese enterprises in their ESG governance practices and disclosure, serving as a reference for self-evaluation and third-party evaluation.”
  • TechCrunch reports that Chinese fuel cell maker eyeing SPAC deal for $1B US listing: “If the deal with its undisclosed suitor goes through, Shenzhen State Fuel Cell Corporation (SFCC) will become the latest in a long line of electric vehicle companies to choose the short route to an IPO. The deal comes at a time when companies that took the SPAC route are facing increasing scrutiny in the U.S., as many EV companies that went public in the last two years haven’t fared well, leading to the U.S. Securities and Exchange Commission (SEC) launching investigations into allegations of misleading shareholders. Toyota, Honda and other global automakers have also invested in research and development to bring fuel cell vehicles to market.”
  • The Financial Times reports that Arm China’s renegade chief makes his last stand: “Allen Wu refuses to surrender control in extraordinary corporate battle at UK chip designer”.
  • The Japan Times reports on how Japan Inc. to be required to disclose gender pay gaps, Kishida says: “Prime Minister Fumio Kishida pledged on Friday to require big firms to disclose wage gaps between men and women as a centrepiece of his ‘new capitalism’ agenda to be compiled this summer that seeks to balance economic and social concerns.”
  • The Japan Times reports on how Nomura starts offering bitcoin derivatives to clients in Asia: “Nomura Holdings Inc. has started offering bitcoin derivatives to clients in Asia after institutional demand for cryptocurrency products increased ‘significantly’ in the past two years.  Japan’s biggest brokerage is offering nondeliverable forwards and nondeliverable options settled in cash, and can now trade bitcoin futures and options, Tim Albers, head of forex structuring in Asia excluding Japan, said in an interview.”
  • The Japan Times reports that Investors push Japan’s J-Power to accelerate climate action: “Japan’s top independent utility Electric Power Development Co., known as J-Power, is under pressure from investors including Man Group PLC and Amundi SA to set more stringent targets for climate action.  Shareholder proposals filed by Amundi, Europe’s biggest asset manager, Man Group, the largest publicly listed hedge fund, and others call on the electricity producer to set new short- and medium-term emissions reduction targets and to disclose details on how to meet those goals.”
  • The Japan Times reports that Nippon Steel reveals plans to deliver 'carbon neutral' steel: “Japan’s biggest steelmaker Nippon Steel Corp. plans to supply carbon neutral steel from the fiscal year starting in 2024, it said on Tuesday.”
  • International Finance Law Review reports that Japan’s TSE changes must go further on corporate governance: “The Tokyo Stock Exchange revamp will be of little use without fundamental changes to allegiant holdings and independent director training, suggest sources”.
  • Mint reports that Sebi forms advisory committee for ESG-related matters: “Essentially, the terms of reference of the committee will include enhancements in business responsibility and sustainability report, ESG ratings and ESG investing. In terms of the Business Responsibility and Sustainability report the committee will look at reviewing leadership indicators that may be made essential - including those related to value chain along with developing sector specific sustainability disclosures.” Read the full announcement from the SEBI here.
  • The Age reports reports that ASX cracks down on ethical fund ‘greenwashing’: “The Australian Securities Exchange has joined Australia’s prime financial regulator in cracking down on investment funds that claim to be ‘green’ but whose claims cannot be substantiated.”
  • The Sydney Morning Herald writes Cannon-Brookes, AGL chief clash over future of Australian energy giant: “AGL Energy has conceded its controversial demerger plans are not consistent with Paris climate goals, despite a majority of shareholders indicating last year they would supporting a demerger only if it met climate targets.”
  • The Brisbane Times reports that Woodside shareholders back BHP buy but blast climate plan: “Woodside shareholders have overwhelmingly approved its acquisition of BHP’s oil and gas business, but almost half of votes rejected the energy giant’s plans to address climate change, in what may be the strongest ever vote against a company’s climate policy.”
  • The Australian Financial Review reports that Bear market realities will follow politics’ ESG moment: “Australia’s corporate leaders will recognise only too well the forces that swept the Morrison government out of office on Saturday night and ushered in a teal wave of independents. After all, they’re the same forces that have transformed the business sector in the past five years.”
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