Remaining focused on active engagement during proxy season

From the outset, the US proxy season was geared up to be eventful as companies, regulators, shareholders and other stakeholders adapted to an evolving policy and legal landscape.

As an active investor, when we invest in a company on behalf of our clients, we can protect and enhance the value of that investment by engaging with those companies on salient issues, as well as by exercising our voting rights. We also have a role to play in supporting our investee companies to constructively navigate the challenges that arise from regulatory and policy change.

We voted at 1,081 US company meetings and voted on 11,988 proposals from 1 January – 31 July 2025. We voted against management on 17.31% of these proposals this year.

One element of continuity with previous US proxy seasons was the persistence of large executive compensation packages and the high-level of shareholder support for them. On average, say-on-pay proposals received 91.4% of supportive votes. Since January 2025 only 11 say-on-pay proposals failed to receive majority support. This is consistent with 2024 when only 1.2% of say-on-pay proposals received less than 50% shareholder support.

There were, however, some notable outliers. There was also an increase in the number of companies seeking shareholder approval to move their business incorporations from Delaware to other jurisdictions, such as Nevada and Texas, that are perceived to have preferential corporate laws.

Director elections remain front of mind

We voted against 8% of board-related management proposals at US companies, compared to 2024 when we voted against 6.8% of board-related management proposals.

In some cases, we voted against directors on grounds of insufficient diversity across a range of perspectives and breadth of experience at Board and/or executive management level, where we deemed this issue to be a material risk to the companies. We also increased the number of votes against directors on grounds of lack of adequate management of climate risks, where our analysis suggested this may translate into financial impacts to the business over time.

Globally, we voted against 76 directors on climate grounds at 62 companies in 2025, compared to 2024, when we voted against 35 directors at 28 companies. In other instances, our votes against directors were driven by other risk factors, such as escalation following Global Norms controversies, or lack of adequate deforestation policies, where we determine this to present material risk due to anticipated regulatory change.

An overall decline in shareholder resolutions in the US

Further to the Securities Exchange Commission (SEC) guideline changes to Rule 14-8, the number of successful ‘no-action’ relief requests for shareholder resolutions granted to Russell 3000 companies rose by 40% so far this proxy season, compared to 2024. When successful, no action relief requests allow companies to exclude a shareholder resolution from their proxy materials. Additionally, withdrawals appear to have more than doubled relative to 2024, reflecting greater willingness of companies and shareholders to reach agreements. As a result, fewer shareholder proposals that were filed at companies made it to the ballots this year. Overall, we voted on 421 shareholder proposals at US companies in 2025, compared to 560 in the previous year.

Some of the key themes that continued to be prevalent in shareholder proposals in 2025 were freedom of association and collective bargaining, child safety impacts, risks associated with AI implementation and climate-related proposals.

We supported 57% of the shareholder proposals that we voted on so far this year, compared to 61% in 2024. The slight decline in our support is due to the increase in anti-ESG (environmental, social, governance) proposals that we did not support. Our analysis of these proposals indicated that they presented a material financial risk to the companies.

The number of shareholder proposals focused on corporate governance issues such as dual class share structures, classified boards, independent directors and severance policies grew year-on-year. In total, we voted on 213 governance-related shareholder proposals, of which we supported 68%.

Reduced support for environmental and social resolutions, with few exceptions

In the US we voted on 63 environmental shareholder proposals, of which we supported 44%. We also supported 50% of the 135 social shareholder proposals that were filed.

There were fewer social and environmental shareholder proposals on proxy statements this year in the US, and overall support also declined by about three percentage points for social proposals and five percentage points for climate proposals compared to 2024.

Despite this decline, shareholders continued to express support for greater oversight and management of social or environmental issues where they presented a material risk to companies. An example of this is seen in human rights proposals, where support increased by two percentage points compared to 202⁵.

Shareholder proposals on environmental issues did however receive low support in the US this year, with fewer resolutions targeting high-emitting companies. In Canada, a shareholder resolution was filed across several of the large banks asking them to disclose the ratio of their finance provided to low-carbon energy versus fossil fuel energy. This received more than 30% shareholder support on three occasions.

Overall, Schroders’ approach to voting at US company meetings did not change this year. It is important for companies to remain committed to their core values to address financially material governance concerns in the interest of our clients.