Shareholder rights dominated the AGM season on each side of the Atlantic this year, with regulatory and political pressure seeing a drop in the number of shareholder proposals reaching the ballot in the US.
Meanwhile, two cases exposed weaknesses in the voting system itself. The first, in the UK, saw a resolution blocked, while the second involved an external registration error in the Netherlands.
BP became a headline moment of this year’s proxy season after its board decided to block a climate resolution filed by the Dutch shareholder advocacy group Follow This and a group of institutional investors from making it to the AGM ballot.
Speaking to IPE, Vincent Kaufmann, chief executive officer of Switzerland’s Ethos Foundation and Ethos Services, said the decision was one of the season’s most serious governance controversies.
“One of the most surprising and worrying events of the season was certainly BP’s board of directors deciding not to submit to a shareholder vote the resolution filed by Follow This and a group of institutional investors,” Kaufmann said.
This led to what many saw as a protest vote, with investors voting against the chair’s re-election, while shareholders also rejected two board-backed proposals, including changes affecting climate-reporting requirements.
No clear collapse in support
Anteris Advisors’ 2026 Proxy Season Review revealed that the number of proposals put to a vote fell by around 15%. Shannon Saffari, a partner at Anteris and the review’s author, described the voting landscape as less transparent, less predictable and more procedurally complex.
However, Lindsey Stewart, director of institutional insights at Morningstar, told IPE that these headline figures may overstate the issue. While there has been a decline in proposals reaching US ballots following the decision of the Securities and Exchange Commission (SEC) largely to stop responding to Rule 14a-8 no-action requests, it was less dramatic than many feared, Stewart said.
His comments came after months of mounting concern on both sides of the Atlantic that the SEC’s moves to protect corporations from their shareholders could have ramifications elsewhere, including Europe.
Earlier this year, mounting tensions between investors and issuers in the US, fuelled by the changes at the SEC, saw four New York pension funds team up to sue AT&T for refusing to include a shareholder resolution on its 2026 ballot.
The city’s funds alleged that the telecoms firm’s decision to exclude a request for more information about its diversity, equity and inclusion performance contravened US securities law. AT&T agreed to put the proposal to a vote a few days later in exchange for the case being dropped.
Although the proposal was defeated, support of almost 29% of votes cast signalled a significant level of investor concern over AT&T’s diversity disclosures.
Meanwhile, Stewart said support for environmental, social and some governance resolutions fell year on year, but added that, once anti-ESG proposals were removed, support for governance resolutions seemed relatively stable overall, while support for environmental and social proposals increased slightly.
“My interpretation is that support for financially material environmental and social topics has largely stabilised, but the reduced number of proposals means investors are sending fewer clear signals about their priorities,” Stewart said.
Director elections and say-on-pay votes have remained largely uncontroversial, he added.
“There continues to be strong support for director elections and relatively high support for say-on-pay proposals. This suggests that companies and investors are increasingly finding common ground on these issues,” Stewart said.
Eumedion’s executive director, Rients Abma, said he saw a similar pattern emerge in the Netherlands, where the majority of remuneration proposals won support. Abma put this down to companies’ increasing willingness to consult investors before bringing proposals on pay to a vote.
Pay pressures
Kaufmann at Ethos also pointed to what he described as the “normalisation” in the US of executive packages worth several hundred million dollars, warning that exceptional awards were increasingly being treated as “market benchmarks”.
“What used to be treated as isolated, headline-grabbing outliers is increasingly becoming an accepted benchmark,” Kaufmann said. “This normalisation risks eroding the link between pay and reasonable performance expectations.”
Boards tightened control
Incidents of companies redomiciling to US states seen as offering stronger management protections and weaker shareholder rights also gave investors cause for concern.
Notably, shareholders approved Exxon’s move from New Jersey to Texas with about 71% support this year. Dell shareholders also overwhelmingly approved moving the company from Delaware to Texas in June.
“Shareholder rights were certainly one of the defining themes of the season,” Stewart of Morningstar said. “Investors are likely to remain focused on these developments because measures that reduce shareholder protections continue to emerge.”
Whether the current voting system is fit for purpose was called into question when an external registration error at geodata specialist Fugro’s 2026 AGM meant that around 39% of the share capital represented at the meeting was incorrectly recorded.
One resolution was initially declared rejected, even though the underlying voting instructions would have carried it. Fugro convened an extraordinary general meeting to correct this.
“Such cases demonstrate that weaknesses in the voting chain can materially affect voting outcomes,” Eumedion’s Abma told IPE.
Concerns and reforms
The voting problems exposed during the season have highlighted the importance of the European Commission’s review of the Shareholder Rights Directive (SRD).
The Commission launched a consultation in February on the effectiveness of the rules, including the exercise of voting rights across borders. The consultation closed in May, with a legislative proposal expected in the fourth quarter of 2026.
Cross-border voting has long been a source of concern for European asset owners, which must navigate varying national deadlines, meeting practices and intermediary arrangements despite common EU rules.
Carine Smith Ihenacho, chief governance and compliance officer at Norges Bank Investment Management (NBIM), said Europe’s shareholder voting chain was not working effectively because member states had applied the common EU rules inconsistently.
“The key issue is fragmentation,” she noted. “Member states have implemented the common EU rules differently, and that creates varied and early voting deadlines, inconsistent meeting formats and variable vote-disclosure practices, all adding complexity across markets.”
NBIM has called for measures including later voting deadlines; confirmation that instructions have been received and processed; and fuller disclosure of voting results.
Other investors favour targeted changes rather than a fundamental rewriting of the SRD.
Matt Lomas, investment manager for sustainable ownership at Railpen, told IPE: “A fundamental redesign is not necessary. Instead, the priority should be targeted and proportionate reforms that improve the practical exercise of shareholder rights.”
