June Hu, Special Counsel in S&C’s General Practice Group and Coordinator of the Firm’s ESG Practice, spoke with Reuters to discuss ESG trends and developments in the 2024 proxy season.
With the recent increase in ESG-related regulations and corresponding decrease in ESG-related shareholder proposals, June noted that investors are less likely to ask companies to go beyond the regulatory requirement in order to avoid exposure to expanded legal risk. Similarly, polarization on these issues has made investors hesitant to take a stance. Given such uncertainty, dialogue between investors and companies over whether management can properly oversee companies’ actions has increased.
Looking ahead, June noted that the lack of certainty around ESG-related regulations is unlikely to subside and that companies should be prepared to navigate an increasingly complex corporate governance landscape. “The divide between pro- and anti-ESG actions by some states will continue unless there is a Supreme Court decision that restricts state laws,” she said.
Read: “New ESG Developments in 2024 Proxy Season Suggest Changes in Shareholder Engagement”