economy
ESG Isn't Dying. It's Getting Voted Out.
When Exxon Mobil shareholders voted this week to move the company’s legal home to Texas, they did so over the explicit objections of the institutional establishment. The measure passed with 71.3% approval, even though ISS and Glass Lewis, the two firms controlling 97% of the proxy advisory market, recommended voting against it.
TL;DR
- Exxon Mobil shareholders approved relocating the company's legal home to Texas with 71.3% of the vote, despite opposition from proxy advisory firms ISS and Glass Lewis.
- The vote signifies a broader trend where shareholders are prioritizing financial returns over ESG (Environmental, Social, and Governance) principles.
- Investor fatigue with ESG is evident in declining support for ESG proposals, significant outflows from sustainable funds, and legislative action in several states against ESG investing.
- Institutional investors and asset managers, historically pushing ESG, are showing signs of adapting by offering more choice and scaling back certain ESG expectations.
- The shift is driven by a shareholder desire for companies to be run like companies, focusing on core business operations and financial performance rather than political or social activism.