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How asset managers can improve their voting record on climate in 2021

With new power comes new responsibility.

A wave of investor engagement and shareholder proposals on climate has been swelling.

A wave of investor engagement and shareholder proposals on climate has been swelling.


Investor engagement on climate change has been gaining unprecedented momentum. 

A combination of extreme weather disasters, weakening revenues and asset write-downs at oil and gas companies, accelerating clean energy deployment and a new administration with ambitious plans for reducing greenhouse gas emissions is driving this increased investor engagement on climate change. As a result, more companies are disclosing climate-related material risks and sharing information about their transition plans to become net-zero businesses. 

Investors are engaging with companies as never before by pairing behind-the-scenes stakeholder dialogue with the one-two punch of filing and supporting public shareholder proposals. All with the goal of encouraging companies to disclose risks and align their business strategies with a net-zero emissions future, in line with keeping global temperature rise to no more than 1.5 degrees. 

In 2020, Climate Action 100+, the world’s largest investor engagement initiative on climate change, grew to include 545 institutional investors with a combined $52 trillion in assets under management — nearly half of all managed assets in the world. Notably, the world's largest and third largest asset managers — BlackRock and State Street Global Advisors — both joined the initiative this year. 

Through the initiative, investors are engaging 100 of the world's largest corporate greenhouse gas emitters, accounting for two-thirds of annual global industrial emissions, alongside more than 60 other companies with significant opportunity to drive the net-zero transition. As reported last week, Climate Action 100+ already has driven nearly half of the companies to set net-zero targets by 2050 or sooner, which sends an important global signal that the net-zero transition is already underway.

The critical combination of increased investor engagement and climate-related shareholder proposals is producing a huge wave of positive results.

This same year, climate-related shareholder proposals during the 2020 U.S. proxy season received record support — garnering an average 30.8 percent approval, up from 26.3 percent approval in 2019. 

The critical combination of increased investor engagement and climate-related shareholder proposals is producing a huge wave of positive results. BlackRock, the world’s largest asset manager, observed in its 2021 Stewardship Expectations report that "For shareholder proposals that received 30-50 percent support, 67 percent resulted in companies fully or partially meeting the ask of the proposal." Occidental Petroleum became the first U.S. oil and gas company to pledge to slash greenhouse gas (GHG) emissions all the way through its value chain from production to final use of its products. On the electric power sector side, 69 percent of the 31 electric utilities on the Climate Action 100+ focus list have set net-zero by 2050 GHG targets or ambitions — often as a result of investor engagement. 

One way to assess the depth of investor concern on climate change is to examine how they react to shareholder proposals which encourage companies to pursue the transition to decarbonization. For clients of large asset managers, a look at their fund’s voting record on climate-related shareholder proposals paired with their work engaging around those proposals is a lens into how they are addressing climate risk in their own investment portfolios. 

A closer look at how asset managers voted

While action by investors behind the scenes is an increasingly powerful force driving portfolio companies to address the risks of climate change, voting is equally critical. Ceres examined the 2020 proxy voting records of 50 of the largest asset managers globally to understand which firms are willing to act publicly to address climate risk. Here’s what we found: 

In 2020, not only did climate-related shareholder proposals achieve record average support, but many shareholder engagement efforts were successful through dialogue with management, convincing them to take specific actions before a proposal seeking such action ever came to a vote. Of 141 climate-related shareholder proposals that Ceres tracked, 57 were withdrawn by the filing shareholder in return for an agreement by the company to address the issue raised in the proposal. That is a withdrawal rate of 40 percent of all climate-related proposals filed in 2020 which, again, shows an increase in the receptivity of companies to make the commitments necessary to reach a net zero future. In 2018 and 2019, the withdrawal rates were 33.7 percent and 39.4 percent. 

With broad support among asset managers for Climate Action 100+ as well as the recommendations of the closely aligned Task Force on Climate-Related Financial Disclosure (TCFD), we would expect wide-spread voting support for proposals in sync with the disclosure requests these initiatives make. But such support isn’t always forthcoming. 

In 2020, seven climate-related shareholder proposals won a majority vote while 15 other proposals could have achieved a majority if just a handful of the largest asset managers had voted for them.

All 12 of the resolutions flagged by Climate Action 100+ investor signatories achieved votes in excess of 20 percent. (Flagged resolutions are those that are filed by Climate Action 100+ signatories which align with the goals of the initiative. See additional discussion below.) To put this in context, proxy advisor Glass Lewis stated that "any time 20 percent or more of shareholders vote contrary to the recommendation of management, the board should, depending on the issue, demonstrate some level of responsiveness to address the concerns of shareholders."

Chart 1 shows the average vote for each type of shareholder proposal related to climate change. For some categories, only a handful of votes make up the average. The most frequent type of proposal that went to vote concerned lobbying disclosure, typically asking a company to disclose how its lobbying, including spending on trade associations, aligns with its public statements on climate change. The next most common type proposal asked for board oversight and governance of climate risk.

Ceres chart

Chart 2 ranks 50 of the largest asset managers globally by the percentage of their votes in favor of 51 climate-related proposals tracked by Ceres that went to vote before the fall of 2020. (For more details on the ranking and the proposals, please see the Methodology section below.) Some noteworthy items on this chart include: 

  • We see a very broad range of support for resolutions among the 50 asset managers studied — BNP Paribas Asset Managers and three firms supported 100 percent of climate-related proposals they voted on while Dodge & Cox supported 0 percent.
  • In fact, Dodge & Cox was the lone asset manager that did not vote for any climate-related proposals.
  • Some 62 percent of the asset managers voted for most climate-related proposals that came before them.
  • Climate Action 100+ signatories (marked by asterisks) are generally grouped at the top of the ranking.
  • Somewhat surprisingly, some of the largest asset managers rank near the bottom.
  • Note that we do not include socially responsible investment firms in the table (due to their size). They generally vote for nearly all climate-related proposals each year. 
    Percentage of votes for 2020 climate proposals

Table 1, below, shows asset manager support for proposals "flagged" by Climate Action 100+ signatories. The criteria for flagging Climate Action 100+ proposals are:

  • The proposal is filed or co-filed by a Climate Action 100+ signatory;
  • The proposal makes a request that is aligned with the agenda of CA100+;
  • The tone of the proposal is deemed appropriate for institutional investor support requiring disclosure or action, without the risk of micromanaging the company;
  • The filer of the proposal and investor lead of the Climate Action 100+ engagement team support the proposal as part of the engagement strategy for Climate Action 100+.

This flagging process serves to signal that these proposals have been carefully vetted by asset managers who are part of Climate Action 100+, an investor engagement initiative that brings together and builds on a number of investor led engagements happening in regions of the world.

As was the case in Chart 2, there was a range of support among asset managers, with most of the largest asset managers supporting most resolutions. However, there was low support from a few Climate Action 100+ signatories. See below for guidance on how investors can improve their stewardship policies to publicly hold companies accountable for climate risk management. 

(Climate Action 100+ signatories are marked with an asterisk.)

Table 1: Climate Action 100+ Flagged Proposals—Votes For / Total Votes

Investor Ratio
AEGON Investment Management B.V* 12/12
Aviva Investors* 12/12
BNP Paribas Asset Management* 11/11
Brookfield Investment Management, Inc. 3/3
HSBC Global Asset Management* 12/12
Legal & General Investment Management* 12/12
NN Investment Partners* 2/2
Nordea Investment Management* 2/2
RBC Global Asset Management, Inc.* 11/11
Aberdeen Standard Investments* 12/12
Union Investment* 3/3
Federated Investment Management Co.* 12/12
UBS Asset Management* 12/12
Natixis Global Asset Management* 8/8
BMO Global Asset Management* 12/12
Eaton Vance Management, Inc. 2/2
Allianz Global Investors* 12/12
Wellington Management Company* 10/11
MetLife Advisers, LLC 10/12
New York Life Investment Management LLC 10/12
Wells Fargo Funds Management LLC* 10/12
DWS Investment Management Americas, Inc.* 10/12
Manulife Asset Management* 10/12
AllianceBernstein LP* 10/12
Neuberger Berman LLC* 9/11
Nuveen Asset Management LLC* 9/11
T. Rowe Price Associates, Inc. 9/12
Amundi Pioneer Asset Management* 3/4
Janus Henderson Investors (US)* 7/10
Geode Capital Management 8/12
Morgan Stanley Investment Management, Inc. 8/12
Northern Trust Investments* 8/12
Schroders* 8/12
Delaware Management Company (Macquarie)* 6/10
JPMorgan Investment Management, Inc.* 6/12
Invesco Advisers, Inc.* 6/12
Franklin Templeton Investments 5/12
Capital Group 3/9
SSgA Funds Management, Inc. (State Street)* 3/12
Goldman Sachs Asset Management LP 3/12
BlackRock* 2/12
BNY Mellon 2/12
Charles Schwab Investment Management, Inc. 1/12
Dimensional Fund Advisors, Inc. 0/12
Voya Investment Management 0/12
Vanguard Group, Inc. 0/12
Fidelity Management & Research Co. (FMR)* 0/12

Based on our analysis, we provide the following recommendations for how these wealth management giants, who manage money for tens of millions of Americans, can work to improve their proxy voting records going forward to back up their private engagements when needed. 

In sum, the data above show that despite growing concern among investors about climate risk, there remains a wide disparity in voting behavior among asset managers. To assist the firms evaluated above that are seeking to improve their voting on climate-related proposals, Ceres provides the following high-level recommendations:
1. Update proxy voting policies annually (or as needed) to ensure voting holds corporate boards and management accountable for addressing material and emerging climate change risks, via votes in support of shareholder proposals as well as other annual votes on directors and auditors, where relevant. For guidance, we recommend using investor-led disclosure standards, including: 

  • The recently released framework for the Climate Action 100+ Net-Zero Company Benchmark.
  • The Task Force on Climate Related Financial Disclosure (TCFD) framework.
  • When relevant, move from "vote For on a case-by-case basis" to generally vote "For" things that these frameworks promote, especially if your organization already publicly supports these initiatives — thereby avoiding misalignment between your organization’s public stance on climate and your voting record.  
  • We also recommend supporting other well-crafted climate-related proposals, including those related to clean energy, deforestation, environmental justice, financed emissions, lobbying, methane emissions, sustainability reporting and water scarcity and pollution. 
  • Other best practice examples of proxy voting guidelines worthy of emulation include those from BNP Paribas Asset Management, DWS (p. 27-28) and Calvert p. 21-22). 

2. Set clear, time-bound milestones for engagement that encourage voting against directors serving on committees responsible for overseeing the areas where companies are not making progress and/or excluding companies from funds after a predetermined period of time.

3. Asset owners should hold asset managers accountable to vote in line with the asset owner’s support for Climate Action 100+ and the TCFD recommendations. Consider embedding climate risk management into new and existing mandates with fund managers. 

4. Disclose voting on or before the date of each company’s annual meeting. This boosts the power of your vote by signaling your intentions to other investors. 

  • Also, disclose (either before or after the annual meeting) the rationale for any votes against resolutions flagged as part of collaborative initiatives such as Climate Action 100+. This can help to reduce reputational harm associated with your misalignment with these initiatives. Examples of investors who provide these types of disclosure include giants CalPERS, BlackRock and SSGA. 

5. Engage proxy advisers by participating in the annual comment periods on their voting guidelines and by providing information to them supporting individual shareholder proposals your organization has filed or supports. 

We hope these recommendations are helpful as investor engagement with companies reaches new levels of influence and becomes a leading force in the effort to address the profound risks and opportunities associated with the climate crisis. Scientific consensus indicates that global GHG emissions must be cut nearly in half by 2030 and reach net zero by 2050 or earlier to avoid catastrophic and irreversible climate impacts on the global economy and society. Votes and dialogues on shareholder proposals are critical to achieving that goal and helping to assure an orderly transition to a net-zero emissions future. 


This study examined the 2020 proxy voting records of 50 of the largest asset managers globally that our data provider, Proxy Insight, covers. Proxy Insight collects voting data from asset managers and owners that is disclosed publicly and, in some cases, Proxy Insight procures voting data directly from the investors. 

We analyzed voting records on 51 climate-related proposals filed with companies headquartered in North America (plus one Dutch company, one from Norway and one based in the U.K.). Ceres uses a broad definition of climate-related proposals. These 51 proposals encompass what Ceres believes to be all climate-related proposals filed in 2020 that went to vote (except for three with annual meeting dates in the fall, which had not gone to a vote in time for inclusion in the data we received from Proxy Insight). The major topic areas the proposals cover can be seen in Chart 1, which includes all 54 climate-related proposals that went to vote in 2020. 

We gathered all of the 2020 climate-related proposals at companies each asset manager could have voted on, and then calculated the percentage of votes "For" each resolution, as shown in Chart 2. In addition, we applied this methodology for the 12 Climate Action 100+ flagged resolutions. In cases where funds within an investment company/fund-family voted inconsistently — when some funds voted "For" a resolution while other funds voted "Against" — we designated these votes as "split votes" and the asset manager was not counted as voting "For" the resolution. In previous years’ analyses we gave asset managers credit for a "For" vote if 75 percent of their votes on a proposal were "For." Thus, our "For" percentage was determined by using For / (For + Against + Split + Abstained + Do Not Vote). 

Another key difference in our analysis this year versus previous years is a change in the allocation of votes to sub-advisers. Due to our switch from Fund Votes to Proxy Insight data in 2020, we adopted Proxy Insight’s methodology for assigning each mutual fund’s votes to the parent company of the sub-adviser (if any) responsible for proxy voting. In previous years, we allocated votes to asset managers without regard to any sub-advisers used to manage their funds. Due to the change in data providers and methodology, in Chart 2 we do not compare 2020 asset manager voting results to their performance in 2019. Year-to-year comparisons are less meaningful due to the methodology changes.

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