Work

What Drives Sustainable Institutional Engagement and Voting Behavior?

Year: 2025

Type: article

Abstract: ABSTRACT We examine what drives institutional engagement and voting on environmental, social, and governance (ESG)‐related shareholder proposals, using data from Principles for Responsible Investment (PRI) and Morningstar. We find that personal engagement often substitutes for voting, especially among large fund families and those using meetings or site visits. Funds that vote more often or disclose less are less supportive of ESG proposals, while those filing proposals or outsourcing votes show more support. Collaborative engagement and longer PRI membership correlate with stronger ESG voting. Though engagement‐active funds don't show major ESG performance gains, they increasingly support firms’ ESG improvements, highlighting the role of active ownership in promoting sustainability.

Source: Financial Review

DOI: 10.1111/fire.70027

Authors: Martin Nerlinger, Martin Rohleder, Marco Wilkens, Jonas Zink

Institutions: University of St.Gallen, Swiss Finance Institute, University of Augsburg, Utrecht University

Language: English

Topic: Corporate Social Responsibility Reporting

Subfield: Strategy and Management

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $2,900

Funder: Stiftung Mercator