AXA IM to Vote Against Companies Lobbying Against Climate Goals

Global asset manager AXA Investment Managers (AXA IM) announced today that it has updated its corporate governanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. & voting policy with more stringent ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. expectations for companies, including a pledge to target high emissions companies lobbying against the goals of the Paris Agreement.

According to AXA IM, the new policy comes amidst an intensifying political backlash against climate-related regulation, contrasting with the urgent need for effective policy intervention to enable a just and orderly transition, highlighting the importance of climate lobbying issues.

Under the new policy, AXA IM said that it will ask for disclosure of climate lobbying activities to ensure consistency with companies’ publicly stated goals, and will vote against high-emitting companies that fail to appropriately report on these activities.

Clemence Humeau, Head of Sustainability Coordination & GovernanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. at AXA IM, said:

“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.”

The announcement marks a further strengthening of AXA IM’s ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. expectations for companies, following the introduction by the firm in 2022 of a voting policy aimed at urging portfolio companies to consider environmentalEnvironmental criteria consider how a company performs as a steward of nature. and socialSocial criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. issues, including setting a timeline to divest from climate laggards that fail to make sufficient progress, and requirements for senior management incentive pay to incorporate ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. and climate elements.

In addition to the climate lobbying expectations, other key changes announced by AXA IM to its policy included advocating for fairer compensation structures, with the firm not supporting pay increases for senior executives when the increases appear to be higher than those for the wider workforce, and opposing bylaw amendments introducing virtual-only AGMs, which AXA IM said may diminish the ability of shareholders to effectively participate and engage the board.

AXA IM also announced a commitment to begin disclosing the rationale for all votes against ESG-related shareholder proposals, noting that in 2023 it supported 68% of all such resolutions.

Humeau 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.”