Report: New Policy Landscape Turbocharges DEI & ESG Activism in 2025 Proxy Season

As the US policy landscape undergoes tectonic shifts, the effects are manifesting in the 2025 proxy season. That’s especially true considering the scrutiny facing DEI and ESG.

A new analysis reveals that the number of anti-ESG proposals more than quadrupled in the Russell 3000 (from 23 in 2021 to 112 in 2024) and the number of anti-DEI proposals also surged (from 1 to 13). What’s more, this trend is expected to further intensify in 2025—and is supported by early data from this proxy season: As of February, a fifth of all shareholder proposals submitted (20%) were filed by anti-ESG groups. That’s a five-percentage point increase compared to the same timeframe last year. 

“Companies are facing an increasingly complex landscape this proxy season, with starkly diverging views on ESG and DEI at the forefront. Firms should prepare to navigate the balance between implementing ESG and DEI initiatives while addressing investor concerns about potential legal and financial risks,” said Ariane Marchis-Mouren, Senior Researcher at The Conference Board and author of the report.

These insights come from a new report by The Conference Board, ESGAUGE, Russell Reynolds Associates, and The Rutgers Center for Corporate Governance. Findings are based on shareholder proposals submitted at Russell 3000 companies, with data as recent as February 12, 2025. Additional insights include:

DEI Proposals

With DEI under fire, shareholder proposals have surged—and will likely remain elevated. 

• 2024 proxy season recap: Anti-DEI proposals more than doubled in the last year, from 6 in 2023 to 13 in 2024. However, support remained minimal at 1.7%.
• 2025 proxy season outlook: Companies should prepare for more shareholder activity targeting DEI efforts, amid increasing political and legal scrutiny on corporate DEI initiatives.

Anti-ESG Proposals

Companies should brace for more anti-ESG proposals in 2025, as the topic remains highly politicized.

• 2024 proxy season recap: The number of anti-ESG proposals filed more than quadrupled in recent years, from 23 in 2021 to 112 in 2024. The number of proposals voted on also surged from 6 to 91.
•  2025 proxy season outlook: Companies should prepare to navigate increasingly complex and competing stances on ESG issues, as they face a growing mix of both pro- and anti-ESG proposals.
  • A fifth of shareholder proposals filed as of February came from anti-ESG groups.

Environmental and Social Proposals

Environmental and climate proposals are losing momentum.

• 2024 proxy season recap: The number of climate-related proposals plateaued compared to 2023. Shareholder support slightly dropped from 21% in 2023 to 19% in 2024.
  • Some companies attribute this trend to evolving regulations, like the CSRD in Europe.
• 2025 proxy season outlook: While E&S issues remain important to investors, some have been reassessing their approach due to concerns over ESG backlash and scrutiny around ESG investing.

Governance Proposals

Investor focus is shifting away from E&S issues toward governance topics—such as executive pay.

• 2024 proxy season recap: Although more governance proposals were filed in 2024, fewer were brought to a vote compared to 2023.
  • Proposals that did go to a vote were significantly more successful (9% passed in 2023 vs. 16% in 2024).
• 2025 proxy season outlook: Companies should expect a similar trend this year with fewer proposals filed, but more average support. 
  • In the first two months of 2025, the primary focus of governance proposals included requests for director election resignation, followed by annual director elections.

Shareholder Activism Campaigns and Proposals

Shareholder activism campaigns are set to surge, despite dwindling support.

• 2024 proxy season recap: The number of shareholder activism campaigns doubled in recent years, from 206 in 2021 to 411 in 2024. But support levels dropped from 57% to 38%.
•  2025 proxy season outlook: Prepare for heightened shareholder activism and a shift in focus areas.
  • Activists will likely focus more on strategic and operational decisions and less on mergers and acquisitions, which were highly scrutinized in 2024.

The volume of proposals may drop in 2025—but this could reflect a deliberate shift in strategy by activists. 

• 2024 proxy season recap: A record level of 1,015 proposals were filed last year—that’s a 27% increase compared to 2021, when 798 proposals were filed. Proposals voted on also jumped, from 483 to 662.
• 2025 proxy season outlook: Some companies expect a decline in proposals this year because of effective shareholder outreach programs and, in some cases, improved stock performance.
  • However, some proponents may focus more on quality vs. quantity, filing less prescriptive proposals that will garner more support.

Average Support

After years of steady decline, average support shows an uptick in the early 2025 proxy season.

• 2024 proxy season recap: Average support for shareholder proposals peaked at 35% in 2021 and steadily declined through 2024 (23%).
• 2025 proxy season outlook: As of February 2025, average support for shareholder proposals stood at 20%, a five-percentage point increase compared to the same timeframe in 2024.

Commentary on the 2025 proxy season:

“Recent and proposed regulatory changes may cause dramatic shifts to the corporate governance ecosystem.  While companies should not ignore those changes, they also should not overreact to them.  Boards should remember that good governance and clear disclosure are timeless,” said Richard Fields, Head of the Board Effectiveness Practice at Russell Reynolds Associates.

“The 2025 proxy season will likely see sustained shareholder activism and evolving priorities in environmental and social proposals. Businesses should continue to monitor policy updates and ensure compliance with regulatory requirements to navigate this dynamic landscape effectively,” said Matteo Gatti, Professor of Law at Rutgers Law School.

“With ‘proposal fatigue’ growing among institutional investors, companies can strengthen investor support by providing detailed cost-benefit analyses of shareholder proposals. They can do this by presenting more information in the proxy statements on the costs, unintended consequences, and limited benefits of implementing shareholder proposals,” said Umesh Chandra Tiwari, Executive Director of ESGAUGE.