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ShareAction

Website:

shareaction.org/
Founded:

2006
Headquarters:

London, UK
CEO:

Catherine Howarth, OBE
Budget (2022):

£3,493,366 (approx. $4.4M USD)
Tax Status:

Registered charity and Company Limited by Guarantee (UK)

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ShareAction is a U.K.-based pressure group that uses relationships with left-leaning pension funds and other institutional investors to create shareholder activism campaigns that pressure companies around the world into adopting left-of-center environmental, social, and governance (ESG) policies. 1 2 3 4

History and Leadership

ShareAction is the working name of the Fairshare Educational Foundation, which is a registered charity in the United Kingdom. It began in 2005 as FairPensions, a project of the left-wing organization People and Planet that received funding from the Trades Union Congress (the British equivalent of the AFL-CIO) to promote left-leaning investment policies at the United Kingdom’s largest public pension fund. 5 6

After that campaign, it turned into a standalone organization in 2006 and expanded its efforts into using shareholder activism to promote left-leaning environmental and social governance (ESG) policies. 7 8 It changed its name to ShareAction in 2013. 9

ShareAction is led by chief executive officer Catherine Howarth, who joined the organization in 2008. 10 She had previously been an organizer for the left-leaning Citizens UK organization. That same year, Howarth also became a member-nominated trustee of the Pensions Trust, now known as TPT Retirement Solutions, which manages the shared pension program for nonprofit corporations across the United Kingdom. 11 12

Howarth was named a “Young Global Leader” by the World Economic Forum in 2014, and in 2022 she was knighted by Queen Elizabeth II and named an Officer of the Order of the British Empire (OBE) “for services to Sustainability.” 13 14

In 2022, Howarth was named to the newly formed ESG Advisory Committee for the Financial Conduct Authority, which regulates financial services firms and financial markets in the U.K.  15 She is also a former board member of the Scott Trust, which is the nonprofit that owns Guardian Media Group, the publisher of the Guardian newspaper. 16 17

Policy Priorities

In ShareAction’s 2021-22 annual report, its board chairman Paul Dickinson advocated for countries around the world “to use the full potential of government” in “unprecedented action” in upcoming years to advance left-wing policies on environmental and social issues. 18 Dickinson added that “ShareAction will continue to ensure the financial system plays an active role in forging the new legislative and regulatory consensus necessary to protect citizens of the world.” 19

ShareAction opposes to the usage of conventional energy, and Howarth has suggested that energy companies should be eliminated through international government action and required “to set up just transition funds for their workforces, created by the income created by the wind-down of assets.” 20

ShareAction advocates for the inclusion of enforceable ESG components in the U.K.’s laws governing the responsibilities of corporate directors and shareholders. In 2019, Howarth testified before a House of Commons committee to promote those policies. 21 In 2020, ShareAction announced a draft of a “Responsible Investment Bill” for consideration by lawmakers in the United Kingdom and European Union that would require pension managers to include ESG factors in their investment decisions and develop a government regulatory structure that would use pension investments as a mechanism to meet the U.K.’s Paris Agreement carbon emissions goals push the country into a “carbon-neutral economy.” 22 23

In 2023, ShareAction called for pension managers to be required to include carbon “net zero” as part of their fiduciary duty to beneficiaries, even if that would mean accepting worse investment fund returns. 24

ShareAction also advocates for European Union regulations to financially penalize insurance companies that provide insurance policies for fossil fuel companies by requiring those insurers to maintain increased capital reserves than would otherwise be necessary. 25

Pension Funds and ESG Activism

In the United Kingdom, most workers participate in an employer-sponsored pension system, thanks in part to a 2008 law requiring automatic enrollment of new employees in a pension plan that increased the percentage of private-sector pension participants by 31 percent between 2008 and 2018. 26

This expansion has driven the growth of private and public-sector pension management entities with large investment portfolios. ShareAction’s strategy for change is to build relationships with left-leaning pension managers, as well as other institutional and large retail investors, then use their allies’ investment stakes in public companies to leverage those corporations into following ShareAction’s demands to take various ESG-related actions. 27

For instance, in 2021 ShareAction worked with public pension funds to pressure the U.K.’s largest supermarket chain, Tesco’s, into adopting a “healthy food” target of 65 percent of revenues from products that meet government-defined health standards by 2025. 28 The agreement covers a reported £52 billion (roughly $65 billion) of corporate revenues, and included a commitment to increase sales of plant-based meat alternatives by 300 percent by 2025. 29 30

ShareAction fights against regulatory changes that would decrease the power of this strategy, such as U.K. government efforts to improve pension plan rates of return by allowing them to invest in high-growth private equity funds that are not subject to the shareholder governance pressure tactics used by ShareAction. 31

One way that ShareAction pressures non-pension fund institutional investors to cooperate with its campaigns is by publishing an annual ranking of the world’s largest asset management companies based on those firms’ adherence to ShareAction’s preferred ESG principles. 32

Shareholder Activism

In addition to its work with large institutional investors, ShareAction also trains and assists individual shareholders to ask ESG-related questions and advance pro-ESG shareholder motions at companies’ annual meetings. In its 2021-22 annual report, ShareAction reported that affiliated investors asked more than 100 questions at 81 corporate annual meetings that year. 33

The Trades Union Congress, the umbrella organization for labor unions in the United Kingdom, has held ShareAction-led training sessions for young union activists to prepare them to support ShareAction’s ESG advocacy efforts. 34

Funding

ShareAction receives most of its funding from left-leaning foundations. 35 In 2022, its largest donor (£639,525, or approximately $800,000 USD) was The Sunrise Project, a left-leaning environmental advocacy nonprofit based in Australia. Other major donors included the IKEA/New Venture Fund (£453,510, approximately $570,000 USD), Guy’s and St. Thomas’ Charity (£416,188, approximately $525,000 USD), Finance Dialogue/European Climate Foundation (£392,665, approximately $495,000 USD), KR Foundation (£160,113, approximately $200,000 USD), The Health Foundation (£134,394, approximately $170,000 USD), Esmée Fairbairn Foundation (£100,000, approximately $125,000 USD) and Friends Provident Foundation (£100,000, approximately $125,000 USD).

In 2022, ShareAction was approved for a $400,000 grant from the Ford Foundation that includes both general support and specific funding for its Workforce Disclosure Initiative to require companies to report on working conditions throughout their international supply chains. 36 37

References

  1. Yeoh, Ben. “Catherine Howarth on Shareholder Activism, Growing Back Better and Change Makers: Podcast.” Then Do Better, July 25, 2021. https://www.thendobetter.com/investing/2021/7/25/catherine-howarth-on-shareholder-activism-growing-back-better-and-change-makers-podcast.
  2. “Our History.” ShareAction. Accessed August 14, 2023. https://shareaction.org/about-us/our-history.
  3. Tichá, Victoria. “Catherine Howarth: ESG Statements Are Just the Start.” Pensions Expert, October 1, 2019. https://www.pensions-expert.com/Special-Features/Catherine-Howarth-ESG-statements-are-just-the-start?ct=true.
  4. “Unlocking the Power of Investors.” ShareAction. Accessed August 14, 2023. https://shareaction.org/what-we-do/unlocking-the-power.
  5. Yeoh, Ben. “Catherine Howarth on Shareholder Activism, Growing Back Better and Change Makers: Podcast.” Then Do Better, July 25, 2021. https://www.thendobetter.com/investing/2021/7/25/catherine-howarth-on-shareholder-activism-growing-back-better-and-change-makers-podcast.
  6. “Pay: High and Low.” TUC Member Trustee News, Spring 2012. https://www.tuc.org.uk/sites/default/files/tucfiles/tuc_targeting_climate_change.pdf.
  7. “Fairshare Educational Foundation – Charity 1117244.” UK Register of Charities. Accessed August 14, 2023. https://register-of-charities.charitycommission.gov.uk/charity-search/-/charity-details/4015135/governance.
  8. “Unlocking the Power of Investors.” ShareAction. Accessed August 14, 2023. https://shareaction.org/what-we-do/unlocking-the-power.
  9. Young, Niki May. “FairPensions to Rebrand to ShareAction.” Civil Society, March 11, 2013. https://www.civilsociety.co.uk/news/fairpensions-to-rebrand-to-shareaction.html.
  10. Howarth, Catherine. “Catherine Howarth OBE | LinkedIn.” Catherine Howarth, OBE. Accessed August 14, 2023. https://uk.linkedin.com/in/catherine-howarth-obe-102092b.
  11. “About TPT.” TPT Retirement Solutions. Accessed September 5, 2023. https://www.tpt.org.uk/about-us/about-tpt.
  12. “Catherine Howarth – Keynote Speaker: Speaker Bureau USA.” London Speaker Bureau. Accessed August 14, 2023. https://us.londonspeakerbureau.com/speaker-profile/catherine-howarth/.
  13. “Catherine Howarth: Order of the British Empire.” The Gazette, June 2, 2022. https://www.thegazette.co.uk/notice/4084214.
  14. Ricketts, Andy. “Hundreds of Voluntary Sector Figures Recognised in Queen’s Birthday Honours.” Third Sector, September 29, 2022. https://www.thirdsector.co.uk/hundreds-voluntary-sector-figures-recognised-queens-birthday-honours/management/article/1788336.
  15. “FCA Announces ESG Advisory Committee to Its Board.” Financial Conduct Authority, December 13, 2022. https://www.fca.org.uk/news/news-stories/fca-announces-esg-advisory-committee-its-board.
  16. “Catherine Howarth – Keynote Speaker: Speaker Bureau USA.” London Speaker Bureau. Accessed August 14, 2023. https://us.londonspeakerbureau.com/speaker-profile/catherine-howarth/.
  17. “The Scott Trust.” The Guardian. Accessed August 14, 2023. https://www.theguardian.com/the-scott-trust.
  18. “Fairshare Educational Foundation T/a ShareAction – Annual Report and Financial Statements.” ShareAction, January 31, 2022. https://cdn2.assets-servd.host/shareaction-api/production/resources/reports/2022-01-31-FS-ShareAction.pdf.
  19. “Fairshare Educational Foundation T/a ShareAction – Annual Report and Financial Statements.” ShareAction, January 31, 2022. https://cdn2.assets-servd.host/shareaction-api/production/resources/reports/2022-01-31-FS-ShareAction.pdf.
  20. “The Just Transition: The Emerging Agenda for Europe’s Investors.” Grantham Research Institute on Climate Change and the Environment, July 7, 2023. https://www.lse.ac.uk/granthaminstitute/news/the-just-transition-the-emerging-agenda-for-europes-investors/.
  21. “Oral Evidence – Corporate Governance: Delivering on Fair Pay – 22 Jan 2019.” UK Parliament, January 22, 2019. https://committees.parliament.uk/oralevidence/8885/html/.
  22. “Five Things to Know about the Responsible Investment Bill.” ShareAction, November 5, 2020. https://shareaction.org/news/five-things-to-know-about-the-responsible-investment-bill.
  23. Miller, Laura. “SHAREACTION Issues ‘ambitious’ Definition of Responsible Investment.” ESG Clarity, July 3, 2023. https://esgclarity.com/shareaction-responsible-investment/.
  24. “In All Our Best Interests: Reforming Fiduciary Duty for the 21st Century.” ShareAction, June 22, 2023. https://shareaction.org/policies/in-all-our-best-interests-reforming-fiduciary-duty-for-the-21st-century.
  25.  “European Parliament’s Economic and Monetary Affairs Committee Adopts Position on Solvency II – ShareAction Response.” ShareAction, July 18, 2023. https://shareaction.org/news/european-parliaments-economic-and-monetary-affairs-committee-adopts-position-on-solvency-ii-shareaction-response.
  26. Ryder, Darren. “Automatic Enrolment Commentary and Analysis: April 2016 – March 2017.” The Pensions Regulator, July 21, 2022. https://webarchive.nationalarchives.gov.uk/ukgwa/20180103165959/http://www.thepensionsregulator.gov.uk/docs/automatic-enrolment-commentary-analysis-2017.pdf.
  27. “Unlocking the Power of Investors.” ShareAction. Accessed August 14, 2023. https://shareaction.org/what-we-do/unlocking-the-power.
  28. “Tesco Sets Health Target in Response to Shareholder Challenge.” ShareAction, March 5, 2021. https://shareaction.org/news/tesco-sets-health-target-in-response-to-shareholder-challenge.
  29. Quinn, Ian. “Campaigners Abandon AGM Revolt after Tesco Makes New Obesity Pledges.” The Grocer, July 18, 2023. https://www.thegrocer.co.uk/supermarkets/campaigners-abandon-agm-revolt-after-tesco-makes-new-obesity-pledges/655726.article.
  30. Davey, James. “Britain’s Tesco Concedes to Activist Shareholders on Health Targets.” Reuters, May 4, 2021. https://www.reuters.com/world/uk/britains-tesco-concedes-activist-shareholders-health-targets-2021-05-04/.
  31.  McLaughlin, Ellie. “How the UK Government’s Pensions Announcements Missed an Opportunity for People and Planet.” ShareAction, July 20, 2023. https://shareaction.org/news/how-the-uk-governments-pensions-announcements-missed-an-opportunity-for-people-and-planet.
  32.  Sood, Abhijay, Jonathan Middleton, and Marina Zorila. “Point of No Returns 2023: Part I – Ranking and General Findings.” ShareAction, February 2023. https://shareaction.org/reports/point-of-no-returns-2023-part-i-ranking-and-general-findings.
  33. “Fairshare Educational Foundation T/a ShareAction – Annual Report and Financial Statements.” ShareAction, January 31, 2022. https://cdn2.assets-servd.host/shareaction-api/production/resources/reports/2022-01-31-FS-ShareAction.pdf.
  34. “As Part of TUC Young Workers Month Unite Young Members Are Running a Training Event on Shareholder Activism.” TUC, March 5, 2014. https://www.tuc.org.uk/research-analysis/reports/part-tuc-young-workers-month-unite-young-members-are-running-training.
  35. “Fairshare Educational Foundation T/a ShareAction – Annual Report and Financial Statements.” ShareAction, January 31, 2022. https://cdn2.assets-servd.host/shareaction-api/production/resources/reports/2022-01-31-FS-ShareAction.pdf.
  36.  “143948 – Shareaction.” Ford Foundation, September 2022. https://www.fordfoundation.org/work/our-grants/awarded-grants/grants-database/shareaction-143948/.
  37. “Workforce Disclosure Initiative.” ShareAction. Accessed August 14, 2023. https://shareaction.org/investor-initiatives/workforce-disclosure-initiative.
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