Don’t Let the SEC Silence Climate-Conscious Investors

For more than 80 years, Americans who own shares in public companies have had a basic right: the ability to put proposals before their fellow shareholders.

Now the Securities and Exchange Commission wants to dismantle the federal rule that makes that possible.

That could make it much harder for shareholders to push corporations to confront climate change, disclose environmental risks, reduce pollution, and explain how their business decisions affect our planet.

Shareholder proposals aren't mandates. They are recommendations. Companies don't have to obey them simply because they appear on a ballot.

But they give investors a voice — and sometimes that voice produces real change.

In 2022, nearly two-thirds of Home Depot shareholders supported a proposal calling for the company to assess deforestation risks in its supply chains. Home Depot subsequently commissioned an independent assessment and published a sustainable forestry report.

Climate-conscious investors have used the same process to push companies for greater transparency about emissions targets and other environmental impacts.

The SEC now wants to rescind Rule 14a-8, the longstanding federal framework governing these proposals, and leave the issue largely to state law and company governing documents.

That could replace one national system with a confusing patchwork — and make it much harder for shareholders to get proposals before their fellow investors.

Shareholders rights are hardly burying corporate America in paperwork. According to the Council of Institutional Investors, companies across an index representing most publicly traded U.S. firms receive an average of just one shareholder proposal every 7.7 years. 

Climate change creates enormous risks for businesses, investors, communities, and our economy. Shareholders should be able to ask the companies they own to address those risks — and other shareholders should be allowed to decide whether they agree.

The SEC is accepting public comments on its proposal through November 20.

Please sign the petition urging the Securities and Exchange Commission to withdraw its proposal to rescind Rule 14a-8 and preserve a strong, nationwide process for shareholder proposals.

The petition to the SEC reads: Do not eliminate the federal shareholder-proposal framework under Rule 14a-8. Shareholders deserve a meaningful, predictable way to raise concerns about climate risk, corporate accountability, and other important issues with the companies they own. Withdraw the proposed rescission and protect shareholders' ability to make their voices heard.
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Sources:

https://insideclimatenews.org/news/03102026/sec-shareholder-proposals-rule-change-climate-action/

https://ir.homedepot.com/news-releases/2022/09-15-2022-130146469