Political hostility to US ESG investing has dampened enthusiasm among American asset managers, while European counterparts maintain support for ESG-related shareholder proposals, according to Morningstar.
The report revealed that independent shareholder support for key ESG resolutions at US companies dropped below 50% for the first time in over three years in 2023.
European asset managers, on the other hand, have not followed the declining trend observed among their US peers. The analysis indicated an average support for key ESG resolutions in 2023 of 50% for the 20 US managers, significantly lower than the 99% average for the 15 European managers evaluated.
Among the US equity fund managers, ten displayed low or very low support for key ESG resolutions in 2023, a notable increase compared to the five based on the average support over the last three years. Negative trends in key resolution support were observed for 12 of the 20 US managers in 2023, with American Century, BlackRock, Capital Group, Goldman Sachs and Janus Henderson showing the strongest negative trends.
In contrast, all 15 European managers consistently demonstrated very high support for key ESG resolutions, reflecting the higher sustainability intentions of European investors.
The report suggested that the current trends in ESG resolution support are unlikely to change significantly in 2024, prompting sustainability-minded investors to question the alignment of their objectives with US managers reducing support for key ESG resolutions.
© 2024 funds europe
