Shareholder ESG Proposals Improve Environmental, Governance Performance Across 1,000 Firms

Recent research shows that companies targeted by sustainability-related shareholder proposals significantly improve their environmental and governance performance, with an average 8% increase in ESG scores and an 11% reduction in carbon intensity, even when proposals are withdrawn or voted down. However, the European Commission's recent withdrawal of the Green Claims Directive threatens to undermine progress toward environmental transparency by allowing continued corporate greenwashing without accountability. This directive would have required companies to substantiate their environmental claims, promoting trust and consumer awareness, but its removal signals a shift prioritizing corporate profits over environmental protection. Amid these developments, events like Malaysia's Unlocking Capital for Sustainability conference aim to equip finance and corporate leaders with tools to navigate evolving ESG regulations and integrate sustainability into business decisions, especially following the pivotal COP29 Finance COP. These dynamics highlight the tension between regulatory setbacks and ongoing efforts to advance sustainable finance and corporate responsibility globally.