As AGM season gets under way, we look at the key trends that will shape resolutions and lay out our guiding principles for voting.
Read this article to understand:
- Key corporate governance-related voting trends for 2025
- The resolutions that will test the attractiveness of UK listings
- The trends shaping sustainability commitments and shareholder proposals
Voting is an essential stewardship activity. It goes hand in hand with company engagement, allowing investors to support companies on their performance, the execution of strategy and the governance that underpins it.
In 2025, the political and macroeconomic environment will shape key voting activity
In 2025, the political and macroeconomic environment will shape key voting activity. In the UK, a variety of corporate actions are under way, with corporate governance approaches adapting to support national growth objectives. Globally, sustainability is under increased scrutiny, driven by the US policy environment.
In this article, we highlight four key questions for the year ahead and lay out the principles that guide us.
To what extent will UK companies and investors follow the Corporate Governance Code?
In 2024, the UK Corporate Governance Code clarified its “comply or explain” principles. This led some companies to adopt new approaches, particularly for remuneration, with mixed investor support. We expect to see more of this in 2025.
We recognise that companies may adopt differing approaches based on their strategy and business model
Through our pre-AGM consultations, we have met companies looking to increase executive pay or change remuneration structures to compete with global or US peers. Not all cases are aligned to company performance, but we recognise that companies may adopt differing approaches based on their strategy and business model. If performance benefits are sufficient and backed by robust governance practices, we will support departures from the code.
How will voting activity shape the long-term attractiveness of UK equity markets?
In 2024, 88 companies delisted from the London Stock Exchange, mainly stemming from moves to other stock markets and mergers and acquisitions. We expect similar activity in 2025.
Several management resolutions at UK companies are seeking approval for a delisting or to accept bid offers from private acquirors
Several management resolutions at UK companies are seeking approval for a delisting (e.g. Ashtead), or to accept bid offers from private acquirors (e.g. Dowlais). Activist investors have also filed shareholder resolutions seeking the unification of some dual listings (e.g. Rio Tinto), which could lead to further delistings. The percentage of investor support for those resolutions will be a good indicator to show how attractive the UK market remains. We will monitor these votes closely and make decisions that will aim to maximise long-term value for our clients.
Will boards be held accountable for strategic and sustainability related changes?
A growing number of companies have revised their sustainability commitments, particularly around climate transition strategies and diversity, equity and inclusion (DEI) targets, citing macroeconomic and political pressures. Investor support and votes on this will vary. For example, both management and shareholders have filed fewer climate-related proposals. As a result, investors may turn to other accountability mechanisms, such as voting against directors and scrutinising executive remuneration.
We would look to understand how changes to strategies and policies are justified
At Aviva Investors, we would look to understand how changes to strategies and policies are justified. Where they are due to external pressures, we will assess whether boards and management have appropriately balanced corporate agility with maintaining a vision that acknowledges long-term opportunities and risk. We will also assess if they proactively collaborate with affected stakeholders to shape the policy environment they operate in.
What are the key shareholder proposal trends for 2025?
Having fallen in 2024, the number of shareholder proposals is expected to decline further this year. This reflects regulatory tightening, shifting investor strategies, and evolving corporate governance practices.
We expect to see more resolutions in emerging fields where risks are less understood
We expect to see fewer resolutions on politically divisive themes, and more in emerging fields where risks are less understood, such as artificial intelligence and biodiversity and nature. In markets where social themes may be contentious, we expect to see greater support for bipartisan issues like labour rights over divisive topics like DEI. And where climate themes are contentious, we expect to see greater support for holistic, systems-level engagement (e.g. corporate lobbying and value chain engagement) over setting targets like time-bound decarbonisation goals. (For more details on holistic engagement, see Only connect: How a holistic approach to investment stewardship can enhance client outcomes).1
At Aviva Investors, we will continue to assess proposals through the lens of strategic, long-term value creation – prioritising governance, transparency, and accountability.
