Activism at AGMs is increasing, leading to both results for the activism and new liners of defence for corporates.

Record numbers of activists have used AGMs to voice concerns with public companies, and ShareAction alone has claimed 116 questions to the leaders of 94 different companies.  

In another example, this year Herefordshire Wildlife Trust asked UK supermarkets about the role their suppliers played in causing pollution to the River Wye, Friends of the Earth challenged Unilever on their palm oil sourcing, and End our Cladding Scandal asked Aviva about the safety status of their leased buildings.

It is not a surprise that there is growth: awareness of the issues is greater, the return to in person meeting after COVID and the more organised protests, led by organisations such as ShareAction have all added to the momentum.

Shareholder activism can work. In January 2021, HSBC shareholders secured a coal finance phase-out commitment from the bank. Again, this was led by ShareAction, and the ‘special resolution’, made HSBC’s management propose its own resolution to phase out coal financing. HSBC must now phase out all coal-fired power and thermal coal mining financing by 2040, and share detailed, medium- and long-term plans for phasing out its fossil fuel financing.

In May 2021, ExxonMobil was pushed by a small hedge fund called Engine No1 that nominated four new members to Exxon’s board of directors; three were successfully installed. Exxon is now answerable to at least three board members intent on moving in a climate-friendly direction. Dutch campaign group Follow This achieved a similar upset at Chevron after lobbying enough shareholders to vote through pro-climate resolutions.

Some corporates are, however, responding to the pressure. For some it is the laudable aim of engaging with activists and creating a dialogue, making compromises or taking suggestions on board. For others there are options to communicate with the main shareholders and ensure that dissenting views are marginalised or even attempting to discredit divergent views.

More direct was the action of the Royal Bank of Canada at its 2022 AGM. The bank waited until the day itself to cancel all in-person elements, wasting long journeys for many attendees. RBC also rejected a key climate resolution concerning oil and gas because it was 49 words longer than the permitted limit.

There is also the ever-present problem that activism can become, or at least be perceived to have become, party political or aligned with extremes.

Social media has turbocharged activism, and action at AGMs. It is unlikely to decline, and very likely to be both more powerful and more successful.

Thanks to ShareAction and BankTrack for information used.

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