Boardroom Breakdowns: Shareholders Clash over Diversity, AI and Climate Accountability
May 30, 2025
By Daniel Kehoe and Caoimhe Taylor
June is the final month of ‘peak season’ before we see a significant drop in US shareholder meetings. Some of the world’s most influential companies will hold their AGMs during the first half of June.
Companies including Netflix (June 5, 2025), Walmart (June 5, 2025), Alphabet (June 6, 2025), Caterpillar (June 11, 2025) and Best Buy Co Inc (June 13, 2025) are all facing shareholder proposals which will demonstrate the divide currently splitting board rooms between pro- and anti-ESG proponents.
We mentioned in our early March blog some of the significant changes which the Trump Administration had made, such as terminating diversity, equity and inclusion-related (DEI) policies, withdrawing from the Paris Agreement and changing Securities and Exchange Commission legal guidance on the shareholder proposal review process. This has no doubt encouraged a more hostile take on ESG from certain investors. While anti-ESG proposals were notable in previous years, their number has surged in the 2025 proxy season.
In this blog we will look at the most important proposals which are set to appear during the first half of June.
One of the persistent trends this year has been the constant presence of anti-ESG proposals among company agendas. These proposals have been a frequent topic in our bi-weekly blogs and have not slowed down.
These resolutions aim to challenge or scale back ESG initiatives. Groups of investors have supported this backlash against ESG, with some believing that companies may have gone too far in their efforts to align with areas such as diversity and inclusion, climate policy and political advocacy, and now urging them to return to traditional business fundamentals.
Alphabet and Best Buy Co Inc will both face a proposal from The National Center for Public Policy Research (NCPPR), which calls on the companies to stop participating in the Human Rights Campaign’s Corporate Equality Index (CEI). The index ranks LGBTQ+ inclusive workplaces. These near identical proposals are critical of the CEI and have branded it a “hyper-partisan […] social credit score”, arguing that corporate alignment with the CEI’s standards could leave the company susceptible to reputational and financial risks.
Netflix is another standout meeting which includes anti-ESG proposals. This time the proposals focus on Charitable Giving, a common feature throughout the proxy season, proposed by Oklahoma Tobacco Settlement Endowment Trust (TSET) on behalf of Bowyer Research. The proposal requests that Netflix produce an annual report on how its charitable contributions may expose the company to risks related to alleged discrimination against individuals based on their speech and religion. The proponent believes that Netflix is favouring progressive causes at the expense of traditional religious or ideological beliefs, potentially undermining the company’s stated commitments.
Netflix also face a proposal from NCPPR that outlines risks associated with affirmative action policies. The proposal stems from a belief that diversity programs could lead to legal or reputational challenges for the company.
Elsewhere, Walmart and Caterpillar will face anti-ESG proposals that go as far as potentially eliminating DEI departments and initiatives. Once again, these are proposed by avid anti-ESG proponent NCPPR. Walmart has also received an anti-ESG proposal on plastics which is interesting and will be discussed in more detail down below. What is interesting is the fact that there is also a pro-ESG proposal regarding plastic and we will witness a showdown between the two, as competing shareholder proposals.
These anti-ESG proposals continue to draw to attention the growing divide in most companies, with one-side advocating for stronger ESG commitments while the other fights to reduce ESG commitments and re-align focus onto primarily financial performance. Either way, the varied agenda at AGMs signifies that ESG is no longer a unified concept, with shareholder opinions diverging. Table 1 below notes the number of anti-ESG proposals at each of these companies for the past three AGMs. We can see a clear pattern of anti-ESG proposals with the total number doubling in 2025 from 2024.
Table 1: Number of Shareholder Anti-ESG Proposals Submitted at AGMs, 2023–2025
The next significant theme is the continued focus on artificial intelligence (AI), which has heavily featured in 2025. As AI becomes increasingly embedded into company infrastructure, shareholders continue to ask critical questions about the ethical and societal implications of these technologies. The 2025 uptick has focused on proposals targeting the governance of AI systems and the protection of human rights in digital operations.
Alphabet is at the forefront of the discussion with three separate AI-related proposals. Anti-ESG proponent have requested the company to conduct regular human rights assessments on their AI tools and data practices. Shareholder Association for Research & Education (SHARE) urged Alphabet to produce a third-party human rights impact assessment examining how its AI-driven targeted advertising policies may affect fundamental rights. The National Legal and Policy Center (NLPC), an avid anti-ESG proponent, has requested the company produce a report assessing the risks posed by unethical or improper use of external data in its AI systems and other topics pertaining to AI data usage oversight.
Dollarama Inc (June 11, 2025) has also received a proposal related to AI. It calls on the company to adopt a code of conduct for responsible AI, focused on the need for guiding principles which can help mitigate risks.
Elsewhere, Walmart faces scrutiny regarding their advertising technologies and surveillance capabilities and how it could pose a threat to consumer privacy and civil freedoms. This prompted a proposal focused on digital civil liberties.
Matching trends we have noted in previous blogs, shareholders continue attempts to increase accountability and promote the adoption of governance reforms that boost shareholders’ rights.
Alphabet, Best Buy, and Netflix have all received proposals from notable proponent John Chevedden requesting improvements to written consent and special meeting provisions. These are not proposals novel to this proxy season – resolutions aiming to amend Bylaws to introduce or lower the threshold for special meetings, and to introduce a right to act by written consent, occur frequently every year, as shown below in Figure 1.
However, a notable difference this year is the frequency of proposals seeking to remove the one-year holding period for special meeting thresholds. These proposals cite the potential limitation that a one-year holding period places on shareholders’ ability to call a special meeting.
Despite this, a one-year holding period is common practice and may institutional investor guidelines consider this provides a reasonable guard against the abuse of the right to call a special meeting by short-term activists. The filing of these proposals within this proxy season links to an overall trend of democratisation and ensuring shareholders have the ability to promote the representation of their interests outside of AGMs.
Figure 1: Frequency of Shareholder Proposals on Special Meetings and Written Consent by year
Tying into this broader trend of proposals aiming to increase shareholder rights and alignment with generally accepted governance practices, Alphabet has also received a proposal requesting the conversion of its shares to ensure all its stock follows the one-vote-one-share principle. This proposal comes from NorthStar Asset Management, drawing attention to the controlled nature of the Company given that Class B shares have 10 votes per share, and that the owning shareholders accounting for 51% of the voting power only hold 13% of actual outstanding shares.
Dual-class structures are considered to be contentious as they can allow for disproportional ownership mechanisms, as highlighted in this proposal, impacting accountability and shareholders’ ability to remove entrenched management. The filing of this proposal at Alphabet therefore links to the ongoing pattern of shareholder engagement aimed at increasing compliance with accepted good practice and promoting shareholder interests.
Once again, shareholders are attempting to increase accountability regarding sustainability, climate change targets, and plastic usage. Despite the anti-ESG trends remaining prevalent for upcoming meetings, sustainability continues to be a key concern for investors.
In line with this, Similarly, Best Buy has received a proposal from Globalance Bank Ltd, requesting disclosures of a climate transition plan to achieve its sustainability goals.
Proposals such as this demonstrate that shareholders wish to ensure corporate actions align with company goals and targets. This is a particularly salient issue at the moment as more companies are accused of corporate greenwashing, setting targets or making claims that are not transparently disclosed or without comprehensive plans to achieve said goals.
Continuing a trend around recycling and plastic packaging, Walmart has received two competing proposals regarding packaging – one from Green Century Capital Management requesting a report into the Company’s plastic reduction goals, and the other from the NLPC.
The presence of an anti-ESG proposal suggests some investor pushback against the reduction of single-use plastics. However, the continuation of a trend in favour of increasing packaging recyclability and sustainability certainly demonstrates that shareholders are looking to boost corporate responsibility and accountability on packaging goals and sustainability initiatives.
Additionally, Dollarama has received a proposal from MÉDAC requesting the implementation of an advisory sustainability vote, known as a Say-on-Climate vote. While this is not a new proposal from MÉDAC this proxy season, having filed this resolution at several Canadian banks, as we have discussed in previous blogs, the presence of this proposal on Dollarama’s agenda certainly indicates that shareholders are continuing to push for sustainability initiatives and comprehensive efforts on climate change.
As the peak of proxy season winds down, the impact of shareholder activism over this busy period is becoming evident, as companies start to amend their policies and strategies in response to the outcomes of their AGMs.
In particular, large companies such as Alphabet can represent governance trendsetters, especially in terms of AI and technology policies, and thus the results of these meetings may lead to real changes across these sectors and industries. As shareholders continue to expect accountability and the adoption of governance items that support shareholder rights, the outcome of these meetings should be closely observed as indicators of the overall trends relating to shareholder activism.
Also worth noting at the upcoming AGMs is the presence of a ‘Vote No’ campaign against Walmart’s Chairman; here, the Shareholder Commons raise concerns with the Company’s wage policies and note that Walmart does not pay its employees the Living Wage. Given the impact wages can have on employee turnover and talent acquisition, as well as broader economic consequences for the Company and its stakeholders, a vote no campaign suggests that shareholders may be dissatisfied with the efforts made by the Chairman to address the risks associated with this. Having discussed in our most recent blog the impact of vote no campaigns and their increased presence in the 2025 proxy season, it will be interesting to see how much traction this campaign gets, and the impact that this will have on the Board’s composition and policies.
In the next blog as we move forward into the peak period of the Japanese proxy season, shareholder activism begins to ramp up with major electrical and power companies such as Kyushu Electric Power Company, Tokyo Electric Power Company Holdings, and Tohoku Electric Power Company, as well as other Japanese companies such as Mitsubishi Corp and Nippon Telegraph & Telephone Corp.
Stay tuned as we progress into the next busy period of the 2025 proxy season!
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Last Updated: 30 May 2025