A shareholder has the right to express their opinion on how the company should conduct itself. This is primarily done through voting at the business's Annual General Meeting, or AGM. A single investor can also put forward a proposal to be voted on by all of the company's shareholders. Occasionally these proposals don’t even need to make it to the AGM to trigger change. If there is enough support for the proposal the company may decide to make the change themselves, before a vote is required.
Another form of stewardship coming to the fore is divestment. Divestment is becoming an increasingly popular way for people to signal their disapproval of companies' business practices and operations. Initiatives all over the world are encouraging pension funds, universities, banks, and other asset managers to divest from oil and gas companies, driving sustainable change.
Key learning objectives:
Understand the role of a shareholder
Understand the power of proxy voting
Comprehend the power of divestment
Learn how divestment is becoming increasingly important