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Report from the Field: The Growing Resonance of System Stewardship
Most shareholders are diversified, so that the most important factor determining their investment success will be the average return of the markets in which they invest, not the financial performance of any individual company. This creates a natural divergence of...
You Want Us to Ignore What? A Brief Analysis of anti-ESG Political Rhetoric
Politicians are vilifying “ESG investing”. The trigger for the furor is political opportunism: because ESG issues often mirror political issues, it is easy to mischaracterize them as leftist activism. Texas has already incurred $300-500 million in extra interest obligations by boycotting banks that account for climate impact in their underwriting businesses. This political strategy protects corporations that externalize costs with business plans that don’t account for social and environmental costs. These politicians are enriching corporate executives, but risking the savings of workers.
Shareholder Lawsuit Charges Meta Platforms with Prioritizing Profits over Shareholders
The Meta Board of Directors has been sued by shareholders for violating their fiduciary duty to shareholders by overlooking policies that exacerbate polarization and incite ethnic conflict.
Closing the Engagement Gap: Two New Case Studies on Climate Change and AMR
Click here to see our case studies on issues critical to shareholders advocating for improved social and environmental performance from companies.
Climate-related Risks & Diversified Shareholders’ Interests
TSC and B Lab U.S. and Canada submitted a comment letter on the proposed rule. Our letter argues for a disclosure framework that would also support a beta stewardship approach. An alpha-centered investment thesis is simply not viable in the face of the climate threat.
Regulation v. System Stewardship: The Fading Promise of Governmental Intervention
ESG activism has failed to stop companies from externalizing social and environmental costs when they can gain a financial advantage. Critics argue that shareholder activism by corporations and investors oversteps their proper sphere of influence in the U.S. Investor activism must focus on the conflict of interest that exists between individual companies and their diversified shareholders.
The Shareholder Commons Talks System Stewardship on The Activist Investor
Tulipshare hosted The Shareholder Commons CSO Sara E. Murphy on their new podcast, The Activist Investor. They had a great conversation about system stewardship and how investors need to move toward a guardrail approach to protect diversified portfolio value
Breaking Free from the Business Case Paradigm
Rick Alexander made an appearance on the Breaking the Fever podcast. Rick discusses the need for investors to shift their perspective from one that considers only one company to one that considers the entire portfolio.
Climate-related Risk & Diversified Shareholders’ Interests
TSC and B Lab U.S. and Canada submitted a response to the Department of Labor’s Employee Benefits Security Administration (EBSA). Our letter focused on two axes of investor-centered climate concern
From Financial Materiality to Sesquimateriality
Rick argued in a piece at The Harvard Governance Forum that the International Sustainability Standards Board (“ISSB”) ought to widen its aperture to prevent its own obsolescence. He also coined a new word.
The Pernicious Problem of Multi-Class Share Structures
Bloomberg columnist Matt Levine spelled out the problem with multi-class share structures. It’s time for underwriters such as Goldman Sachs and JPMorgan Chase to stop enabling what the SEC Investor Advocate described as a “festering wound”
Response to System Stewardship Challenges
A recent article by Marcel Kahan and Edward B. Rock critiqued the sort of system stewardship we promote at TSC. But the authors do not really question the idea that in some circumstances diversified investment fiduciaries would want to address the threat from portfolio companies that externalize costs to other investees
Johnson & Johnson Proposal Survives SEC Challenge
Johnson & Johnson sought to exclude our proposal asking for a report on the costs it externalizes by limiting access to its COVID-19 vaccine technology, and how its diversified shareholders absorb those costs. By rejecting both arguments, the SEC made clear that shareholders have a legitimate interest in voting on proposals that address the macroeconomic implications of a significant policy issue.
Here Comes Proxy Season
Proxy season 2022 is right around the corner. This edition is dedicated to the 19 shareholder proposals we’re supporting this year. We also highlight a US$46B asset owner CEO’s public support for system stewardship.
Hopeful Signs from a Difficult Year
Let’s face it: 2021 brought plenty of disappointments. The pandemic ground on, democratic ideals appeared to be in retreat around the world, and the planet continued to accelerate toward and even past critical boundaries. But if we look upstream, 2021 also provided...
A Turnkey Solution for Diversified Investors
TSC provides full set of tools for investors ready to protect critical social and environmental systems
TSC in the News – Matt Levine and System Stewardship
Matt Levine of Bloomberg addressed the FOX PBC proposal and why insisting that Fox stop disinformation may be bad for profit but good for shareholders
Broadridge Financial Agrees to Climate Measures and More Transparent Proxy Audits
TSC issued a press release announcing the withdrawal of a shareholder proposal after Broadridge agreed to new approach to climate and greater transparency
TSC Weighs in on the Shareholder Proposal Rule
The Shareholder Commons added its voice to invalidate new rules that make it harder for shareholders to submit proposals at the annual meetings of U.S. corporations.
Vanguard and Universal Ownership
The report shows why Vanguard is a universal owner that should serve the interest of its diversified investors and focus on systems first investment.
A REFRESHING LOOK AT FIDUCIARY DUTIES—Significant New Report Shows that All Institutional Investing Must Be Responsible Investing
The new report shows why investment professionals around the world are legally compelled to prioritize systemic issues such as climate change, inequality, and biodiversity loss over the financial performance of individual companies.
MEDIA, MARKETS, AND SYSTEMIC RISK —The Case for Media Companies to Convert to Public Benefit Corporations
On September 14, 2021, The Shareholder Commons initiated an investor campaign to convert media corporations to public benefit corporations (PBCs) with a specific purpose of providing accurate information.
The Allbirds IPO Is All Wet: When Some Shares Are More Equal Than Others
We write because of a concern that shareholder voice is being muted on critical social and environmental issues.
Our letter to the U.S. SEC on Exclusion of shareholder proposals implicating the significant policy issue of cost and risk externalization
We write because of a concern that shareholder voice is being muted on critical social and environmental issues.
The Beta Steward Proxy Review 2021
This is the first yearly edition of The Shareholder Commons’ (TSC) Beta Steward Proxy Review, a progress report on how investors are reframing their shareholder engagement practices to prioritize beta stewardship.
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“Returns are just means to an end.” What institutional investors really think about systems-level investing.
TSC + Beyond Alpha convened 17 investment organizations with a combined $1.3tn in AUM to discuss the practical implications of adopting system-level thinking in their investment and stewardship practices.
Our Letter to the DOL
The Department proposed new ERISA rule on ESG investing may interfere with the obligations of retirement plans with respect to stewardship.
Catching Up, Keeping Up
A recording of the event is available here, and provides a good grounding in the theory behind our work, as well as our plan for shareholder-sanctioned limits
Changing Minds, Changing Rules, Changing Behavior
Communicating TSC’s ideas, changing rules so that they protect common interests, and ensuring asset managers and owners follow minimum standards of corporate behavior
A 3,000 Year Old Lesson
Companies receiving government assistance should be required to adopt governance that prioritizes the future health of our social and environmental systems.
Lessons From a Crisis
The coronavirus pandemic has raised attention to the broad systemic crisis we face and the need to respond accordingly to guarantee a future in which we all thrive.
The Day After Groundhog Day A Reflection on GreenFin ’20
Time for our planet is not standing still and though the search for Alpha must continue the world could also really use a “Better Beta”
From Alpha to Beta: BlackRock and the ABCs of Sustainability
Last week saw the replaying of an annual ritual in the financial world. The ritual goes like this: Larry Fink, the Chairman of BlackRock, the world’s largest asset manager, issues a letter talking about the importance of something other than financial measurements in...
New Paper from Harvard Confirms Investment Laws are Absurd
The paper explained that pension funds, 401(k) plans and similar are governed by the “sole beneficiary rule”
How Shareholders Can Save the Planet
David Webber’s new book, The Rise of the Working-Class Shareholder: Labor’s Last Best Weapon, might just as well have been titled, “How Shareholders Can Save the Planet.” Webber, a professor at the Boston University School of Law, has written a book that tells a...
The Problem with Political Spending
One key area of focus at The Shareholder Commons is equipping shareholders with the tools to limit corporate political spending. This article takes a few steps back in order to explain why limiting such spending is essential to our mission and to creating a just and...
This Month’s Ramble: The Purpose of Purpose
Given that The Shareholder Commons is all about making private enterprise act more responsibly, readers might believe we would be all about the current efforts to endow corporations with greater purpose. Larry Fink, who runs the largest asset management firm in the...
September’s Ramble: Did the Business Roundtable Just Solve Everything?
Just one business day after the launch of The Shareholder Commons, the Business Roundtable announced that it had created a new Statement on the Purpose of a Corporation, which declares that stakeholders, including workers, customers and communities, are as essential...
ONE LAST CHANCE TO PROTECT COMMON RESOURCES AND COMMON DECENCY
WHERE ARE THE REGULATORS? In an economy based on competition, we simply cannot rely on individual businesses to self-impose sustainability rules that take priority over profit. Sustainability boundaries must be implemented collectively in order to be effective. While...
What AI Can Teach Us About Corporate Law and the Dangers of Shareholder Capitalism
Computers are not the only type of machine that presents this problem. Organizations, including corporations, are also data-processing machines. Data comes in — the availability and price of supply, customer demand, rules, economic outlook — and the company uses the...
Accountability Now: An Investor Call to Action
5 Investment Principles to Measure and Manage Systemic Impact Worldwide equity markets are valued at $70 trillion, and venture capital and other private equity at $10 trillion. The owners of these securities control the private economy, which allocates most of our...
Beyond Corporate Social Responsibility: Think Systems to Build a Good Business
Benefit Corporation Model Focuses on More Than Finances If investors want to save our threatened environmental, social and economic systems, they must think and act systemically. This call to action goes beyond the type of sustainability envisioned in BlackRock’s...
After $65M Funding Splash, Plant-Based Start-Up Hopes for Ripple Effect
Benefit Corporations Take Capital Campaigns to New Levels—and New Goals for Social Good Ripple Foods, a dairy-free manufacturer start-up founded by Neil Renninger and Adam Lowry, recently completed a Series C funding round. This puts the company in the ranks of other...
Together, we're embarking on a fundamental transformation of our financial system...