Support for shareholder resolutions related to environmental and social reforms in U.S. companies has drastically declined, averaging 16% for the 12 months ending June 30, a 50% decrease from three years prior. This trend is attributed to political hostility, particularly from Republicans, and increased corporate disclosure on ESG matters. Even top proxy advisers like Institutional Shareholder Services and Glass Lewis have reduced their backing for such resolutions, although Glass Lewis suggests this is partly because many U.S. companies now meet basic environmental expectations. Anti-ESG resolutions filed by conservatives, however, continue to receive low support, averaging 2.7%.
Investors are pulling out of sustainable funds at record rates, with a total of $8.6 billion in net outflows in the first quarter of the year. This marks the tenth consecutive quarter of outflows for U.S. sustainable funds. Notably, European investors became net sellers for the first time on record, withdrawing $1.2 billion, indicating that the anti-ESG sentiment, largely driven by the U.S., is spreading globally. This has led to concerns among asset managers about promoting sustainability credentials, with some funds even changing their names to remove ESG-related terms.
The decline in ESG investing support is not uniform, as asset managers like T. Rowe Price have also reduced their backing for environmental and social proposals. For example, T. Rowe Price supported only 8% of environmental resolutions and 4% of social proposals in 2024. Despite these widespread outflows and reduced support, some analysts note that demand for more stringent ESG funds remains resilient, and the overall assets in U.S. sustainable funds reached a record high of $368 billion at the end of 2025, even with three consecutive years of client money loss.
