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Improving Corporate Disclosure on Environmental Issues

Real, long‐term influence demands a multilayered approach.

Maria Elena Drew, Director of Research, Responsible Investing; Donna Anderson, Head of Corporate Governance
T. Rowe Price,  Insights, February 2020


  • Climate change has become a much more urgent environmental, social, and political concern, with distinct challenges for investors.
  • Improving company disclosures on environmental issues is crucial for calculating risks within investment portfolios.
  • We combine proxy voting, including judiciously voted shareholder proposals, with engagement to promote better disclosures.


Discourse among the public, politicians, and investors on the climate change problem has intensified remarkably. There is now a heightened emphasis by the media and environmental advocates on shareholder proposals that focus on climate issues. That scrutiny is particularly focused on how asset managers vote on shareholder proposals related to environmental issues, especially those oriented to improving disclosure.

We believe the added media attention is ultimately a force for good that can help improve corporate disclosures in this area. However, there are many nuances to environmental shareholder proposals to consider. Simply measuring the category of voting on a straight for or against vote metric is misleading. The complex problem of climate change requires a multidimensional approach that includes, but goes beyond, proxy voting.

A Multidimensional Focus on Better Disclosure

We believe that climate change is a critical investment issue—it is a global challenge that will touch virtually our entire investment universe.

Globally, regulations to mitigate climate change remain limited, but we expect they will broaden and intensify in coming years, elevating the potential impact on corporate performance and profits and spanning sectors and geographies.

Robust corporate disclosure of environmental data is essential to our efforts to measure how a company is placed to respond to any changing regulations and, as such, how attractive it will be as an investment. At T. Rowe Price, we use our scale and influence to improve disclosure practices of companies in a multidimensional way. We combine proxy voting, engagement, investment diligence, and, ultimately, as a large active manager, portfolio construction.

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