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Companies around the globe increasingly receive immense shareholder scrutiny due to perceivably excessive executive director remuneration. The debate in South Africa intensifies due to severe pay inequality. The authors thus accounted for the perspectives of asset managers and listed financial services companies in South Africa pertaining to the impact of voting and engagement on director pay policies and practices.

Semi-structured interviews were conducted with selected asset managers, chief executive officers, chief financial officers and remuneration committee members of listed financial services companies to gauge their views on the impact of shareholder activism endeavours on remuneration governance. The qualitative data was analysed by conducting thematic analysis.

Most of the asset managers and financial services representatives preferred proactive, private engagement on pay concerns, given the impact thereof on voting outcomes, and ultimately director remuneration practices and policies. Independent remuneration committees have a prominent role in facilitating engagements with investors to ensure fair remuneration.

The consequences should be clearer if organisations receive substantial votes against their pay policies and implementation reports. South African regulators can consider the “two-strikes” rule to ensure that action is taken in response to shareholder voting on director remuneration matters.

Representatives of asset managers and listed financial services investee companies offered valuable insights on remuneration governance deliberations in an emerging market. This in-depth analysis highlights the importance of proactive engagement to ensure that corporate leaders are paid fairly.

This paper aims to substantiate the premise that the very task of socially responsible investment (SRI) today is to achieve impact. Based on extensive empirical studies on how different strategies deliver on this impact premise, it recommends changing the current strategy mix from a focus on exclusion to shareholder engagement.

Based on an extensive review of the SRI literature, various SRI strategies are theoretically evaluated. Subsequently, an example of a bank that applies a sophisticated engagement strategy is presented.

It is shown that there are indeed severe differences in the effects of exclusion, positive approaches and shareholder engagement. Impact-oriented investment products should use engagement strategies.

By providing an empirically based rationale for shareholder engagement, this article gives those who practice it a moral and economic justification. Instead of having to defend why there are seemingly unethical companies in their portfolio, they can go on the offense and counter that the “pure” role models are actually “impact washers”.

By emphasizing the primacy of the impact of investment products, the transmission mechanism of the capital market to create positive change for the environment and society is strengthened. This should lead to improvements in both areas.

While there are some other studies that examine investor impact in some way, they often do so in a context that is unrelated of sustainable investments. This study structures the empirical evidence on the effectiveness of exclusion, positive approaches and shareholder engagement and provides a recommended course of action for investors and policymakers.

Purpose – Responsible investor (RI) engagement seeks to change corporate strategic priorities while balancing the financial imperative. This chapter uses an institutional theory framework to explore the tension between financial performance and environmental, social, and governance (ESG) issues in RI engagement.

Methodology – Discourse of the proponent, supporters and opponents of Australia’s first climate change shareholder resolution – a minority proposal, will be analyzed using framing analysis.

Findings – Framing indicated that the discourse emphasized the dominant financial performance logic while often omitting the ESG logic. One possible explanation is that the process of shareholder proposal nomination and the financial imperative of investment organizations effectively co-opted the engagement.

Research limitations – A case of responsible investment engagement is used to illustrate multiple logics in the investment field. Although there are significant limitations to drawing inferences from a single example, the discussion is relevant to RI support for engagement initiatives such as the UN Principles of Responsible Investment clearinghouse and Carbon Disclosure Project Carbon Action. This chapter argues that attempts to change corporate strategic actions on climate change by RI through engagement will be less effective while the financial performance logic provides relatively more legitimacy to investors.

Practical implications – Integrating the ESG logic with the financial logic is vulnerable to co-optation due to incommensurability. Operationalizing both logics requires establishing a boundary between ESG and financial logics to develop legitimacy.

Social implications – RI engagement on climate change has the potential to be an important part of the social response to the sustainability agenda.

Originality – In applying institutional theory to RI climate change activism this chapter presents original insights into the potential of engagement to effect change.

To demonstrate how the Society of Jesus (Jesuits) in the United States through the “National Jesuit Committee on Investment Responsibility” played a significant role as a socially conscious institutional and religious investor in influencing Chevron’s Human Rights Policy 520 and to analyze the factors that contributed to a successful shareholder engagement with the company.

Case study based on firsthand information.

1. Our conclusion offers support for Allen et al.’s (2012) conclusion of legitimacy (credibility) being the dominant force in a successful engagement.

2. We found that coalition-building is a significant moderating variable in increasing shareholder salience. This finding contradicts the study by Gifford (2010).

Our conclusion offers support for Allen et al.’s (2012) conclusion of legitimacy (credibility) being the dominant force in a successful engagement.

We found that coalition-building is a significant moderating variable in increasing shareholder salience. This finding contradicts the study by Gifford (2010).

The chapter is based on the actual process of shareholder engagement with Chevron Corporation that led to the human rights policy and is written mainly based on firsthand information.

Institutional investors in emerging markets are increasingly under pressure to integrate environmental, social and corporate governance considerations into their investment analyses and ownership practices. Old Mutual Investment Group (OMIG) is a South African-based institutional investor that has long been regarded as a pioneer in responsible investing. The purpose of this study was to examine the nature and effectiveness of OMIG's private shareholder activism endeavours over the period 1 January 2014 to 30 June 2018.

A unique database was constructed using proprietary, point-in-time data for 69 listed companies covering 283 private engagements. Binary logistic regressions were conducted to test the hypothesised relationships.

The majority of the private engagements centred on executive remuneration. This finding was not unexpected given the large and growing wage gap in South Africa. Close to two-thirds of OMIG’s private deliberations were successful. Engagement success was positively associated with a targeted company’s capacity to change and desire to protect its reputation.

This study only investigated the private shareholder engagement actions of a single, well-resourced institutional investor.

The findings serve as an encouragement to other investors who are contemplating a more active approach to change unethical and unsustainable corporate policies and practices.

This unique analysis sheds light on the determinants and success of private shareholder activism in an emerging market.

The Stewardship Code, the first of its kind for the Financial Reporting Council, seeks to encourage better dialogue between shareholders and company boards. Given the UK market's role as a governance paragon, the code principles will be critical to practices of good stewardship taking root globally. But this new Code raises concerns, for example, as to how to treat non‐UK investors who collectively now hold upwards of 40 percent of the country's equity market. Would they voluntarily adhere to the code, and, if not, how relevant or effective would the code be? The purpose of this paper is to shed light on these topical questions.

The paper focuses on stewardship as an important criterion for assessing the performance of larger shareholders (i.e. institutional shareholders). Section 2 explains the concept of “stewardship”. It also outlines its growing importance. Section 3 introduces the Stewardship Code, tracks back its genesis, focusing, in particular, on the underlying themes and the major principles and guidance in the Code. Section 5 then critically assess the Code, looking in particular at major possible obstacles. Finally, implications from the preceding discussion are drawn in Section 6.

Section 4 reveals a hidden truth (the “stewardship spectrum”), i.e. in practice, companies operate in an ever‐changing business world, a more rapidly changing business practice with more pressures and complexity and with more diverse “players” and conflicting interests at play. It is submitted that this hidden truth effectively poses a challenge to the success of the Code.

This paper is geared towards providing the reader with critical tools to assess the likely impact of the Code.

The purpose of this paper is to deepen the discussion about religious organisations’ (ROs) potential to practise their faith by means of their investments, rather than keeping both issues separate.

The authors adopted a qualitative exploratory approach using seven cases of social shareholder engagement (SSE) by Christian organisations. It focused on creating knowledge from best practices.

Within the three Christian organisations studied, the authors identified three significant features that relate to their religious nature and affect their SSE: having a structured belief system, a grassroots network and a long-term perspective. These features can be instrumental in impacting company behaviour and society at large.

The authors chose three ROs for their relevance and comparative features, but this limited sample size makes it hard to generalise the research findings.

This paper invites ROs to review their potential for actively owning their shares to be consistent with their faith and create change in business and society at large. Besides, ROs, with their unwavering belief system, extensive grassroots networks and long-term approach, are a force in the shareholder engagement field to be reckoned with by business.

The paper presents multi cases of ROs active in using their investments to create change in companies and society at large.

The purpose of this paper is to analyze antecedents of listed corporations’ propensity to adopt online shareholder platforms. It differentiates two strategic investor relations (IR) frames, shielding and engaging, and explores their effect on ICT adoption.

Findings are based on a survey of 82 corporations listed on the Swiss, German and Austrian stock exchanges. The authors apply multiple linear regression analysis to test a multi-faceted adoption model.

The authors find that resource constraints, familiarity with online media and efficiency considerations drive listed corporations’ willingness to adopt online shareholder platforms. Beyond these operational antecedents, strategic considerations significantly affect adoption: IR functions geared toward shareholder engagement are more likely to apply interactive platforms, while IR departments geared toward shielding the corporation from shareholder interventions will be less attracted to the participatory affordances of online media.

This study is limited in scope to corporations listed on the Swiss, German and Austrian stock exchanges and cannot account for antecedents distinct to other regulatory environments.

IR functions need to carefully develop and apply communication strategies, which in turn will inform ICT adoption. The authors find that IR departments geared toward a two-way symmetrical communication model are more attracted to the participatory affordances of online platforms. Thereby, they are more likely to innovate by employing current digital applications.

This study contributes to research on the benefits of digital media to two-way symmetrical and dialogic corporate communications. It is the first study to explore these relationships in the context of IR. It further contributes to research on the strategic role of IR by developing and applying two distinct strategic frames to the subject of ICT adoption in IR.

This paper aims to examine the potential liability of companies and their board members arising from the use of digital technology and social media as communication and engagement tools with investors and shareholders.

The research relies on a qualitative study using legal analysis of corporate and capital market laws as well as the outcome of legal proceedings and regulatory actions to ascertain conduct that could expose companies and boards to liability risks.

Social media characteristics expose unwary directors and companies to potential liability for oppressive conduct, selective disclosure or misleading statements.

This paper informs boards and companies of the types of conduct that could expose companies and boards to liability when social media is relied on to communicate with shareholders and investors.

The paper contributes to the literature on social media, capital market and corporate communication by presenting the legal perspective concerning reliance on social media as shareholders’ engagement and corporate communication tool.