Shareholder Engagement Strategies for Environmental, Social, and Political Issues Board Memorandum


Summary

This template memorandum is for use by corporate or outside counsel to explain to the board of directors of a public company why and how they should adapt the company's shareholder engagement strategy to a newfound emphasis on environmental, social, and political (ESP) issues. This template contains practical guidance and drafting notes. ESP issues have increased dramatically in importance to shareholders over the last twenty years. Climate change, workforce diversity, corporate political spending, and #MeToo-related sexual harassment policy reforms are a few of the most prominent, but certainly not the only, issues that activist shareholders have pressured companies to address. This has come from a swing toward institutional investors owning greater percentages of companies' stock than in the past, and a resulting swing in shareholder preference toward long-term performance gains. Counsel should apprise the board of their public company clients as to the importance of ESP issues to shareholders, changes in engagement strategies needed to address the new emphasis on ESP issues, and the effect these concerns may have upon the board itself and management. You should make all necessary additions, deletions, and modifications needed to tailor this memorandum to the circumstances and shareholder engagement needs of your client. For a broad collection of content related to hostile takeovers and shareholder activism, see Hostile Takeovers & Shareholder Activism Resource Kit. For a full listing of key content for in-house counsel and corporate secretaries when performing corporate functions, see In-House Corporate Secretary Resource Kit. For a full listing of related proxy statement and annual meeting content, see Proxy Statement and Annual Meeting Resource Kit. For a full listing of related climate change content, see Climate Change Resource Kit. For additional information relating to shareholder engagement and ESP issues, see Investor Objectives, Strategies, and Key Considerations in Shareholder Activism, and Corporate ESG Disclosure: Recent Trends and Developments.