The liberal business establishment has long supported progressive causes, even to the detriment of their bottom lines. Conservative consumers and investors often feel helpless to stop such support in the face of the massive financial power of these firms to resist pressure from protests or boycotts.
However, a new activist has appeared on the scene, rattling corporate boardrooms and causing hullabaloos. The new kid on the block is the anti-woke shareholder who is the killjoy of shareholder meetings. These protestors oppose the environmental, social, and governance (ESG) mandates that are entering their corporations. They are spoiling the party by bringing anti-ESG measures to the floor for votes.
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Although most proposals fail to pass, they do raise awareness among shareholders, forcing management into crisis management mode. To keep the peace, corporate officers are toning down or eliminating their support for liberal causes. The proposals finally provide a platform for conservative shareholders to express their legitimate concerns about woke management. The effort is having an impact that is not small.
The new tactics are largely the brainchild of conservative think tanks that have studied corporate vulnerability. They carefully phrase the proposals to make reasonable requests that will safeguard the resources and reputation of targeted companies.
Thus, groups like the National Center for Public Policy Research (NCPPR) have crafted dozens of shareholder measures readymade to question the wisdom of corporate involvement in climate, diversity and environmental issues that clash with shareholder interest. Other measures ask for more oversight of existing ESG efforts or call for transparency on donations to LGBTQ and other controversial causes.
The results have been encouraging. ISS-Corporate, a company that monitors investor issues, reports that shareholders at S&P 500 companies have voted on 70 measures opposing ESG initiatives in the first five months of 2024 alone. That number is up from 30 in 2022 and a mere seven in 2020.
Ironically, anti-woke shareholders are adopting tactics first introduced by their woke counterparts years ago. ESG activists argued that not investing in these liberal causes would bring risk to the companies’ reputations since the public would expect them to be woke and progressive.
The anti-woke activists respond by pointing to consumer disasters like the transgender-friendly ad of Bud Light and Target’s 2023 Pride merchandise offensive as examples. They say the real risk lies on the other side of the rainbow. Activists stress that woke agitators have weaponized business policy. Companies should stay out of politics and stick to making profits.
Carefully crafted anti-woke proposals are aimed at risk-averse executives facing shareholders. For example, measures ask the company to provide reports on the risks of voluntary carbon-reduction promises, doing business in Red China, or using child labor in supply chains. Others propose oversight or the ending of donations or partnerships with LGBTQ groups or other liberal causes.
Another tactic of the anti-woke shareholder is to negotiate with company management to keep measures off the ballot. In exchange, they can receive assurances that actions will be taken to reduce exposure to risky policies and avoid controversy at shareholder meetings. Most measures, however, do make it to the floor.
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Many times, shareholder action coincides with consumer backlash, which increases the effectiveness of the activism. The Target disaster was a perfect storm that put management in a tight place. Activist shareholders are suing the company for its lack of judgment in imposing its aggressive Pride collection upon consumers last June.
Thus, even management in those publicly owned companies who want to support the woke agenda find themselves in a bind. Shareholders, after all, own the companies and have a right to say how they should be run. Introducing carefully crafted questions into the debate forces companies to go on the defense.
Despite statements assuring pro-ESG advocates of their sympathy despite the cut in support, companies are backtracking, awaiting less vigilant times when they can return to their woke ways.
For now, anti-woke activists are on the rise and growing. Their inconvenient questions are enough to raise doubts in the minds of shareholders that management would prefer not to appear. Their intelligent tactics prove that anyone can be effective, even in the face of the financial might of major corporations.
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