Climate change on top of the investors' agenda

Every year institutional investors increase their portfolio weight in Spain, managing already more than 50% of the market cap of listed companies. Hence, the importance to know what are the topics they are most interested in and to determine how they exercise their voting rights at the shareholders meetings. The sixth edition of the Morrow Sodali's Institutional Investor Survey, the annual poll of over 40 institutional investors with $29 trillion in assets under management, reveals that, according to 85% of respondents, climate change tops the list of topics in their engagement with the Boards.

The survey points out how the attention to ESG is constantly increasing: investors see a clear link between ESG performance and good financial performance of the companies and require them to improve their commitment and reports on these issues. The vast majority of them (95%) would like to see ESG targets incorporated into the executive incentive plans, as well as sustainability metrics included into the short-term incentives plans.

In this interview with Expansion, Morrow Sodali’s cross-border Project Manager, Patrick Wightman, also highlights how Shareholder activism continues to evolve: “86% of respondents (compared to only 12% in 2018) agree that collaboration with other shareholders is the most effective way to influence Boards.” Bad financial results and bad strategic decisions were the factors that most likely led investors to support the activists.

Read the full article here (in Spanish).