Navigating a new reality for environmental and social shareholder proposals

Proxy advisors such as ISS help institutional investors, including Danske Bank Asset Management, navigate thousands of resolutions at company meetings. They collect and analyse company disclosures and shareholder proposals, publish research, and issue voting recommendations. For Danske Bank Asset Management, ISS provides research based on its benchmark policy, as well as customised voting recommendations based on our individual voting guidelines.

Given the important role of proxy advisors, changes in their voting recommendations merit close attention. And the data suggests that recommendations have changed markedly.

A marked shift in recommendations

An analysis of ISS proxy-voting data for Danske Bank Asset Management’s voting universe from 2022 to 2026 shows a particularly pronounced shift in recommendations on environmental and social shareholder proposals. The share of shareholder proposals supported under ISS’s benchmark policy fell from approximately 40–49% in 2022–2024 to below 10% in 2025–2026. The decline was broad-based, covering several recurring proposal categories rather than a single topic.

“It is difficult to identify a single reason for the shift observed in the data, but it raises important questions about how external pressures, evolving methodologies and changing market expectations may influence the voting recommendations that inform voting decisions. The change has also taken place amid heightened political, regulatory and legal scrutiny of proxy advisory firms in the United States, where their role in shareholder voting and ESG investing has become increasingly contested,” says Oshni Arachchi, Head of Active Ownership at Danske Bank Asset Management.

“This uncertainty is precisely why we do not rely solely on proxy-advisor recommendations but apply our own customised approach,” she adds.

Investors make the final decision

While proxy-advisor recommendations are an important input, they do not automatically determine investors’ final voting decisions. In the data reviewed, Danske Bank Asset Management sometimes supported shareholder proposals even when ISS recommended voting against them.

For certain predefined environmental and social proposal types, ISS issues a “Refer” outcome, sending the proposal to Danske Bank Asset Management’s Active Ownership Team for internal assessment. This underlines the continued importance of investor-specific policies, company context, and expert judgement.

“In 2026, we supported just over 20% of the environmental and social shareholder proposals we voted on. This reflects our own case-by-case assessment, based on our voting guidelines, company-specific context and expert judgement, rather than the automatic application of an external recommendation,” explains Oshni Arachchi.

Could AI strengthen the process?

Relying on case-by-case assessment keeps decisions grounded in Danske Bank Asset Management’s own principles, but it also raises the bar for documenting and explaining each decision consistently. Investors need to understand how research and proprietary guidelines inform recommendations.

Against this backdrop, Oshni Arachchi sees AI as a potentially valuable tool for supporting Danske Bank Asset Management’s voting activities.“We are exploring how AI could help us apply our own detailed voting principles more consistently to underlying research and company disclosures, identify proposals that require closer review, and document how recommendations are reached,” she says.

However, environmental and social proposals often involve case-specific trade-offs that cannot be captured by simple rules.“The strongest use case is likely to be supporting rather than replacing human judgement. The goal should not be automation for its own sake, but a process that makes voting decisions more consistent, explainable and closely aligned with investors’ own principles,” Oshni Arachchi says.

Want to learn more?

If you’re interested in learning more about our analysis of proxy-advisor recommendations and the developments shaping stewardship approaches across markets, reach out to your advisor to schedule a meeting or join us at our annual stewardship training.

This publication is marketing communication and has been prepared for informational purposes only and does not constitute an offer or solicitation to make an offer to buy or sell any financial instrument.