Know your rights

The document examines the legal frameworks governing shareholder resolutions in thirteen European countries, focusing on how investors can compel companies to adopt Paris-aligned climate strategies. It identifies a recurring tension between the general management powers of corporate Boards and the reserved rights of shareholders to amend a company's Articles of Association. The guide argues that framing climate 'asks'—such as net-zero commitments, transition plans, 'Say on Climate' votes, and lobbying disclosures—as amendments to the Articles of Association is often the most effective legal path to ensure resolutions are tabled at Annual General Meetings (AGMs). While the UK, Ireland, Spain, and Sweden are described as relatively simple jurisdictions for filing, others like France, Germany, and Austria require more nuanced framing to avoid infringing on Board competencies. The Netherlands is highlighted as the only jurisdiction among the thirteen where shareholders cannot legally compel a company to table a resolution without Board consent.

• In twelve of the thirteen European jurisdictions analyzed, there is a legal path for shareholders to file or 'requisition' climate-related resolutions, with the Netherlands being the sole exception where no such legal avenue exists to compel a company to table a resolution without Board agreement.
• A central legal challenge in many jurisdictions is the tension between the Board's general competence to manage company affairs and the shareholders' right to amend the Articles of Association; framing resolutions as amendments to the Articles is recommended as the most robust way to overcome Board objections.
• In the United Kingdom and Ireland, the legal framework explicitly allows shareholders to issue directions to the Board. In the UK, this is typically achieved through special resolutions, which are binding if passed with at least 75% of total voting rights.
• In France, a mandatory division of powers prevents shareholders from interfering in the Board's strategic management. To be permissible, climate resolutions must be carefully worded and framed as amendments to the Articles of Association to avoid being challenged as contrary to law.
• German law prohibits shareholders from giving detailed instructions to the management board, but the Articles of Association can be used to establish a general framework for corporate social responsibility and climate action that the Board must follow.
• In the Czech Republic, a distinction is made between 'business management' (Board competence) and 'strategic management' (shareholder competence). Climate resolutions can often be filed as strategic goals without needing to amend the Articles of Association.
• Spain has introduced seminal legislation as of May 2021 requiring listed companies to include an annual assessment of climate-related financial risks in their management reports, including quantified five-year reduction targets for certain companies by May 2022.
• In the Netherlands, because shareholders cannot compel the tabling of resolutions, they must rely on alternative tools such as voting against directors during re-election, voting against the discharge of the Board from liability, or proposing 'discussion items' for the AGM agenda.
• The guide identifies four primary types of climate-related 'asks' for investors: commitments to net-zero by 2050, the development of Paris-aligned transition plans, 'Say on Climate' advisory votes, and disclosures regarding corporate climate lobbying.

APA

Benson, P., Williamson, A., & Marjanac, S. (2021). Know your rights. ClientEarth. https://www.clientearth.org/media/bovm4flz/know-your-rights-a-guide-for-institutional-investors-to-the-law-on-climate-related-shareholder-resolutions-final.pdf

Chicago

Benson, Paul, April Williamson, and Sophie Marjanac. Know your rights. ClientEarth, 2021. https://www.clientearth.org/media/bovm4flz/know-your-rights-a-guide-for-institutional-investors-to-the-law-on-climate-related-shareholder-resolutions-final.pdf.

Wikipedia

{{cite report |last1=Benson |first1=Paul |last2=Williamson |first2=April |last3=Marjanac |first3=Sophie |title=Know your rights |publisher=ClientEarth |date=October 2021 |url=https://www.clientearth.org/media/bovm4flz/know-your-rights-a-guide-for-institutional-investors-to-the-law-on-climate-related-shareholder-resolutions-final.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{benson2021know, author = {Benson, Paul and Williamson, April and Marjanac, Sophie}, title = {{Know your rights}}, institution = {ClientEarth}, year = {2021}, month = oct, url = {https://www.clientearth.org/media/bovm4flz/know-your-rights-a-guide-for-institutional-investors-to-the-law-on-climate-related-shareholder-resolutions-final.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }