Sustainability Resolutions: US-Europe Gap in Support Stabilizes, But Remains Wide

Environmental, social, and governance themes in investing are frequently talked about as if they are one big group. But recent history shows that although ESG themes are connected, they are treated very differently by investment decision-makers.

Our latest research paper illustrates this. 

The paper examines how investors have voted at shareholder meetings over the last six years, focusing on their voting decisions on shareholder resolutions that seek to address sustainability and governance topics.

Overall, we found that governance proposals are faring better than environmental and social ones at the corporate ballot box. Also, European asset managers continue to strongly support sustainability proposals. That’s a stark contrast to US asset managers.

The chart below shows the underlying trends in ESG-focused proxy voting in the US, excluding the growing number of “anti-ESG” proposals that generally gain poor support.

Amid a general decline in the number of shareholder resolutions, governance proposals outnumbered those addressing environmental and social themes for the first time since 2021.

Meanwhile, average support for conventional governance proposals has largely held up between 30% and 40%, while support for conventional E&S proposals has halved from 33% in 2021 to just 16% in 2025.

Even amid this decline in support for E&S resolutions, we have been able to obtain reliable signals on investors’ views on sustainability by analyzing significant resolutions.

According to Morningstar’s methodology, significant E&S shareholder resolutions are those that gain the support of at least 30% of a company’s shareholders. These resolutions are the ones on which a sizable proportion of investors aim to send a clear message back to company management on their expectations regarding financially material sustainability topics. These could include climate change, human capital management, or oversight of new technologies like artificial intelligence.

Unfortunately, we’re getting fewer of those signals than ever, with the number of significant E&S resolutions falling from 107 in the 2024 proxy year to just 30 in 2025. Twelve of those 30 resolutions addressed political spending transparency—a social topic with a particularly strong governance focus.

Of the 18 significant resolutions that remain, eight proposals were resolutions on technology oversight voted at just three “Magnificent Seven” tech companies—Alphabet GOOGL, Meta Platforms META, and Microsoft MSFT. While those votes give useful insights into investors’ views on the social and governance challenges in Big Tech, what happens at those giant businesses bears little resemblance to what’s going on in the rest of the market.

That leaves just 10 significant proposals on what we can describe as core sustainability themes—a very thin population of votes on which it is difficult to draw firm conclusions.

All the same, it is still worth examining asset managers’ voting records on significant resolutions for clues on what may be changing amid such volatility.

The chart below shows average support for significant E&S resolutions for 12 large US asset managers: six in the US (BlackRock, Dimensional, Invesco, JP Morgan, State Street, and Vanguard) and six in Europe (Amundi, Fidelity International, Legal & General, NBIM, Schroders, and UBS).

With the caveat that the 2025 data is based on a thin population of votes, the gulf in voting preferences on sustainability that has grown between US and European asset managers since 2021 appears to have ceased expanding. However, with European average support stable for several years at above 90%, compared with just 18% among the US managers, the gap remains wide.

In the institutional investor space that I now cover for Morningstar, we’ve seen some of the more sustainability-focused asset owners deciding to move funds to new asset managers, or considering doing so, seeking better alignment with their views on environmental and social topics.

There are now more options than ever that allow institutional investors to better align proxy voting policy implementation with their organizational priorities on sustainability, governance, and business ethics—including proxy voting policy choice and "multi-track" stewardship policies offered by a growing number of large asset managers. 

Still—as we discussed at length at last month's Morningstar Sustainable Investing Summit—many institutions will continue to consider whether a change of mandate is their preferred move.