A new wave of ESG activism has emerged: understand what it means for public companies and their stakeholders
Climate-related shareholder activism, although not a new phenomenon in Canada, is no longer the exclusive domain of environmentalists and increasingly a key plank in institutional shareholder and activist campaigns. A new era of climate-related activism is dawning, from “say-on-climate” and other environmental-related shareholder proposals, to proxy fights over the adequacy of companies’ climate-related transition plans or emissions-reduction targets, to climate-related litigation against companies and their directors and officers for “greenwashing” and other matters. We anticipate that climate will become the predominate issue in upcoming proxy seasons, particularly for issuers in the mining, metals, energy, industrial and tech sectors, as well as for those issuers’ lenders and key service providers.
Canadian companies and their directors and officers wishing to avoid public scrutiny or regulatory intervention need to keep their climate strategy at the forefront, including by embedding meaningful and coherent processes to assess and manage climate-related risks and opportunities throughout their business; developing and implementing plans to fulfill climate-related promises (such as navigating a net zero transition); and engaging proactively with stakeholders.