The US proxy season has seen very little support from shareholders for anti-DEI and anti-ESG proposals, despite the political climate set by the White House.

A report from Teneo, a consulting firm, shows that anti-DEI and anti-ESG support fell from an average of 1.9% of shareholders to 1.4%. Only one proposal received more than 3% of the vote, after examination of AGM outcomes between January and May this year.

However, research also shows that there has been “diminishing” support for environmental and social proposals.

Investor support for environmental proposals fell from an average of 18% to 11%, while social proposals dropped from 18% to 14%.

Teneo says companies may face challenges in gathering investor feedback.

“Offseason outreach is becoming more important than ever,” write Teneo senior executives.

“With the annual meeting cycle complete and no live ballot items on the table, conversations may allow for more candid dialogue around investor expectations, governance priorities and evolving ESG views.

“As both sides adjust to the new normal for engagement, shaped by regulatory shifts, political scrutiny, and changing stewardship approaches, early outreach will be essential.

“Investor calendars will fill quickly, and demand for fall meetings is expected to be high.”

Silent witnesses

This year’s AGM season has taken place against a backdrop of new guidance on investor engagement, which caused many managers to pause their conversation with companies to avoid any suggestion they were acting as activists. Conversation resumed under strict “listen-only” conditions.

Elsewhere, research shows that median CEO compensation among the largest 500 US companies has climbed year on year by 3.8% and now stands at $16.2m.

The median pay ratio for these CEOs to median workers is now at 213.5:1. Joyce Chen, associate editor at board advisory firm Equilar, writes: “The aftermath of the Covid-19 pandemic, ongoing inflationary pressures and political crosswinds have all contributed to an increasingly competitive market for high-level leadership.

“In response, companies have continued to increase pay packages to attract and retain top talent, especially as the role of the CEO becomes more complex and demanding.”

Equilar says say-on-pay votes have received an average of 90.2% support, in spite of rising CEO pay. Equilar adds: “However, recent volatility could drive opposition and there are early indicators of weakening support.”

The number of companies failing their say-on-pay votes this year has risen from three to four while the companies receiving low support—under 70%—has increased from 4.6% to 6.5%.