Boardroom recap: 2023 proxy season

This year was another active one for shareholder proposals, marking the third straight proxy season in which the total number of submissions that went to a vote increased.1 But the rise in volume didn’t automatically correlate to greater support. Shareholders were more discerning when casting their votes, leading to declining support for almost every category of environmental, social and governance proposals. We saw a similar result in 2022.

While year-over-year comparisons may not always reveal an accurate picture of voting sentiment since the mix of topics and proposal requests can change every proxy season, boards should understand the 2023 results as they perform annual governance reviews and conduct offseason shareholder engagements.

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1 Unless otherwise sourced, voting data on shareholder proposals was provided by Proxy Analytics as of June 30, 2023.

Proposal volume increased but support dropped off

The 580 proposals that were put to shareholder vote represented a slight uptick from last year and a 25% increase from 2021. Before the proxy season began, we anticipated high proposal activity, but the tally exceeded our expectations.

Several factors largely accounted for the increase in shareholder proposal activity. First, a 27% jump in the number of executive compensation proposals signaled a renewed focus on executive pay packages. Shareholders continued to show interest in environmental and social issues, which accounted for more than half of the proposals tracked. Also playing a part was the after effects of the SEC narrowing the circumstances a company can use to exclude shareholder proposals from their proxy statements. The number of no-action letters — requests from companies to exclude proposals on grounds such as “duplication” and “ordinary business” — continued to drop, although 2023’s success rate was significantly higher than 2022’s.

…Read more in the report

Russell 3000 shareholder proposals 2023 2022 2021
Proposals announced before proxy filed2 182 256 152
14a-8 No-action letters submitted 116 140 224
Proposals voted on 580 562 463
Total 878 958 839

2 "Proposals announced before proxy filed" counts proposals that proponents announced publicly, but were not ultimately included in the proxy statement or excluded through the no action process.

Shareholder support for environment and social proposals plummets

The 2023 proxy season featured opposing trends related to environmental and social proposals.

The total number of environmental and social proposals that made it to a vote continued to rise, reversing a trend of relatively flat volumes during the pandemic. One of the biggest drivers of the increase in volume was the emergence of so-called “anti-ESG proposals” that encourage companies to rescind ESG initiatives they are considering or already have in place. Russell 3000 companies had 89 of these proposals, up from 54 last year. The 41 that made it to a vote averaged just 6% support (none passed).

…Read more in the report

Say-on-pay support rebounds and severance agreements gain the spotlight

Average support for say-on-pay proposals fell in the years following the pandemic as shareholders sought stronger ties between compensation and performance and challenged the rationale for one-time awards as well as the rigor of performance goals. But support for pay packages rebounded this year, with S&P 500 and Russell 3000 companies receiving 88.6% and 90% support, respectively, for their compensation plans.

…Read more in the report

Directors are still subject to shareholder scrutiny

The vast majority of board elections are routine, but even small movements in support can be telling. Boards should be regularly analyzing the voting policies of their major shareholders and conducting engagements so that they can understand any changes and proactively take action. Common reasons for voting against directors include lack of board diversity, oversight failures, poor climate risk management disclosure, failed engagement activities, executive compensation issues and overboarding.

…Read more in the report

Looking ahead to the rest of 2023

As boards look ahead to fall engagement activities, it will be paramount for them to analyze and understand developments that could impact shareholder proposal volumes and topics. However, boards should also consider the growing list of topics that could lead to a negative director vote. Finally, while there has been significant media attention on retail voting, efforts to boost retail involvement do not appear to have had a material impact yet.

Contact us

Maria Castañón Moats

Leader, Governance Insights Center, PwC US


Paul DeNicola

Principal, Governance Insights Center, New York, PwC US


Matt DiGuiseppe

Managing Director, Governance Insights Center, Boston, PwC US


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