How are climate activists reframing shareholder engagement?
Carine Girard-Guerraud, Yves Rannou, and Sabrina Alioui's examine how climate-focused shareholders collaborate with other stakeholders in « Shareholder Activism on Climate Issues: The Role of Framing and Stakeholder Systems ».
They analyse the role of actors like NGOs, climate experts, or proxy advisors in framing climate engagement campaigns to win support and show:
- Successful shareholder campaigns are structured around three complementary frames: disclosure-seeking (motivational), financial materiality (diagnostic), and double materiality (prognostic).
- The disclosure-seeking frame emphasises transparency and urges companies to disclose more, often using TCFD-aligned disclosure demands as an entry point for engagements.
- The financial materiality frame casts climate change as a financial risk or opportunity for the company and its investors and diagnoses climate issues in terms of shareholder value.
- The double materiality frame links environmental impact with financial outcomes, arguing that companies should account for their impact on the environment to account for long-term financial health.
- These frames are not mutually exclusive: activists can start by demanding disclosure, then use financial materiality arguments to get broad investor buy-in, and finally push for commitments that fulfil double materiality.
- A successful engagement doesn't just change one company's behaviour: it influences how other stakeholders and competitors view the issue.
- Collective actions have broadly reinforced the financial materiality frame and injected scientific rigour into investor dialogues, making the double materiality concept more tangible as well.
This paper shows investor activism is maturing into a collaborative, system-wide force that often complements policy goals to align financial with environmental goals.
Climate proposals should be framed in terms of financial risk and opportunity to persuade a broad base of stakeholders and show it is part of fiduciary duty rather than just moral obligation.
As a limitation, it should be noted these insights are drawn from 37 interviews, predominantly with European pro-climate institutional investors and their close stakeholders.
Also, framing success was inferred from participants' accounts and observed shifts in discourse, not measured in terms of quantifiable corporate outcomes like emissions reduction or better returns.