AXA IM calls on companies to appropriately report on their climate lobbying activities in its updated voting policy

• Highest emitting companies actively lobbying against the goals of the Paris Agreement will be held to account from 2024.
• Wider workforce taken into account for executive pay proposals.
• Bylaw amendments seeking to introduce virtual-only AGM format will be opposed.
• Case-by-case approach to ESG-related shareholders proposals to remain, with disclosure of the rationale for vote against.

Ahead of the new 2024 voting season, AXA Investment Managers (AXA IM) announces three main updates to its corporate governance & voting policy to further reinforce its ESG expectations.

With climate remaining a top priority, AXA IM will continue to use its voting power to play a key role in financing the transition to a greener and more sustainable world.

The main following changes will now be applied within the voting policy:

• Climate lobbying: A dissenting vote against relevant resolutions may be cast at the highest emitting companies that fail to appropriately report on their climate lobbying activities. This highlights the importance of climate lobbying issues as the political backlash on climate-regulated regulation intensifies, in contrast with the urgent need for effective policy intervention to enable a just and orderly transition.
• Pay fairness: As inequalities can have unintended consequences for society, create instability and reduce economic growth, AXA IM advocates for fairer compensation structures. Consequently, the cost-of living crisis as well as the wider workforce will be further considered when voting on executive pay proposals particularly when the Board is proposing a pay increase to its lead executives.
• Virtual AGMs:  AXA IM will seek to oppose bylaw amendments introducing virtual-only AGM formats (except in emergency situations) to ensure that all shareholders are able to effectively participate and engage with the Board of Directors.

Moreover, to provide the highest level of transparency to all its stakeholders, AXA IM will start disclosing the rationale for all votes against ESG-related shareholder proposals.

Clemence Humeau, Head of Sustainability Coordination & Governance at AXA IM, said:

"As part of our responsible investor commitments, we remain committed to regularly evolving our practices and policies over time and we acknowledge the need for real economy policies to further support the transition to a net-zero world. During this 2024 voting season, with governments and political action at the forefront of the energy transition, climate lobbying of investee companies in high-impact sectors will notably be a reinforced area of focus to ensure consistency between publicly stated goals and corporate lobbying.”

Additionally, AXA IM can reveal the key outcomes of its voting initiatives for 2023:

• Opposition rate stood at 15%, with at least one vote against cast in 62% of the meetings voted.
• 187 votes were cast against the Board Chair, the Governance Committee Chair, or any other relevant resolutions due to insufficient disclosure or poor oversight of climate-related issues at Board level.
• Support for 68% of all ESG-related shareholder proposals, after carefully analyzing each proposal on its own merits. This case-by-case approach aimed to ensure shareholder rights are used in a way which is supportive of effective and directed change. Through this, AXA IM aims to ensure the proposals supported are well targeted, while acknowledging ongoing efforts and commitments.

To read AXA IM’s Corporate Governance & Voting Policy in full, click here.