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In the second week of April, the Taiwan Depository & Clearing Corporation (TDCC) hosted a conference focused on preparing for the 2025 Taiwan AGM season, with a particular emphasis on the development of local shareholder activism.
Frances Wang joined Philip Foo (Vice President, APAC Research and Engagement, Glass Lewis), Glenn Maguire (Head of Asia ex-Japan Research, ISS Stoxx), and Edward Soon (Head of Markets & Lending Solutions, APAC Middle East & Africa, S&P Global) to discuss Taiwan’s AGM landscape, as well as broader trends, including the recent anti-DEI backlash in the United States.
Key Conference Takeaways
- Local Shareholder Activism and Governance: Taiwan is preparing for the 2025 AGM season amidst local shareholder activism trends, with a focus on improving corporate governance beyond compliance. Despite high retail investor involvement, engagements between investors and independent directors remain limited in this market. In contrast, Japan and Australia are two markets where stewardship codes are available in the APAC region.
- Investment Stewardship: Asset owners are encouraged to play a more active role in advancing governance practices. Stewardship codes and active engagement are seen as crucial tools for driving improvements in transparency and board independence.
- Artificial Intelligence in ESG: AI is increasingly used to detect greenwashing risks, monitor biodiversity, and support real-time carbon credit tracking. Its integration into ESG assessment and reporting is a growing trend in the region.
- Challenges in Asian Markets: The prevalence of family-controlled, founder-controlled, and state-owned enterprises poses barriers to transparency and governance reforms in Taiwan and broader Asia.
- ESG and Climate Focus: Speakers emphasized the importance of focusing on energy transition, ecosystem health, equality, and credible climate risk assessments in their ESG assessments. The evolution of investor engagement has led to more effective dialogue and resolution outcomes.
- Data Integrity and Reporting: The rapid evolution of global reporting standards demands high data integrity. Dedicated teams are being formed to improve data quality and develop analytical tools for thematic ESG research.
- Future of Investor Engagement: Optimistic views are expressed on the future of investor engagement. An example is used in the US, where shareholder proposals are often withdrawn after successful dialogues with companies. Future declination of shareholder proposals is expected as companies increasingly seek and receive SEC approval to exclude E&S focused shareholder proposals.
