Market Strength and Easing Diversity Expectations Drive a Shift in Voting Patterns at U.S.-Based Companies, According to Diligent Market Intelligence

In the 2025 proxy season, U.S. companies saw support for director reelections reach a five-year high of 94.2%, according to the Investor Stewardship 2025 report published by Diligent Market Intelligence (DMI). This strong backing for incumbent directors signals a notable shift in investor sentiment, reflecting heightened confidence in corporate leadership amid strong market conditions and a recalibration of priorities for board composition.

This trend was particularly pronounced in major indices. During the 2025 annual meeting season (July 2024 - June 2025), director support in major indices rose significantly, reaching 96.3% in the S&P 500 and 95% in the Russell 3000, driven by strong markets and relaxed diversity mandates. DMI Governance data shows that the share of newly appointed women directors fell from 37% in 2022 to 32% in 2024, declining further to 26% in the first half of 2025.

Among the Big Three asset managers, the report reveals that State Street saw the largest jump in S&P 500 director support, reaching an average of 95.4% in 2025, up from 92.7% in the prior season. BlackRock supported 98.7% of director reelection proposals, up from 98.6% the previous season, while Vanguard saw director support in the S&P 500 reach 99.3%.

"The Investor Stewardship report reveals a critical insight: investor support has decisively shifted toward rewarding financial performance. With the retreat from diversity mandates, investors are now more likely to hold directors accountable for financial performance and their roles on specific board committees,” said Josh Black, Editor-in-Chief of Diligent Market Intelligence.

Dissent over pay found to erode overall director support

While overall director support reached new highs, dissent over executive pay emerged as a significant risk. Among the 30 Russell 3000 companies that faced more than 50% opposition to their “say on pay” plans in the 2025 proxy season, a striking majority saw a decline in overall director support. This growing investor pushback often spilled directly into the boardroom, making compensation committees a focal point.

DMI governance data reveals compensation committee chairs faced tougher scrutiny, averaging 94.5% support at S&P 500 companies, which was notably below the 96.3% overall average, signaling targeted investor dissatisfaction. Only nomination committee chairs fared worse, with their average backing slipping even further to 92.2%.

In 2025, investors at Russell 3000 companies voted against “say on pay” plans for several key reasons, including pay versus performance misalignment, concerns over discretionary awards or one-off grants, and insufficient disclosure and transparency.

Shareholder proponents see shift in the balance of power

Average support for shareholder proposals continued to decline in the 2025 proxy season. This was illustrated by BlackRock, which supported a mere 2.4% of environmental-focused resolutions and 2.5% of social-themed proposals at Russell 3000 companies.

At the same time, companies increasingly sought relief from the U.S. Securities and Exchange Commission (SEC), resulting in a record volume of no-action requests for shareholder proposals submitted under Rule 14a-8 and a 33% jump in those approved for exclusion. This overwhelming workload, compounded by a government shutdown, prompted the SEC to recently announce that it would not provide substantive responses to no-action requests for the 2026 proxy season.

“The 2025 proxy season tested the boundaries of Rule 14a-8, especially in what many saw as a corporate-friendly environment,” said Black. “However, governance-focused proposals continue to resonate with investors with the most prominent asset managers recording average support upwards of 20% at the Russell 3000. This clearly signals that fundamental governance remains a non-negotiable priority for shareholder engagement.”

Download the comprehensive report to explore the critical factors driving investor voting patterns and gain essential analysis of the regulatory shifts in 2025 that have radically reshaped the landscape for stewardship teams.

About the report

Data featured in the report is based on the proxy season from July 1, 2024, to June 30, 2025. Following the rollout of new functionality, DMI assigns a “house threshold view” as the default position of a fund family’s in-house stewardship team – where at least 90% of shares held by the asset manager are voted in the same manner.

Further data with bespoke analysis is available on request. For more information, please email dmi.press@diligent.com.

About Diligent Market Intelligence

Diligent Market Intelligence (DMI) is a market-leading provider of shareholder activism, investor voting, and corporate governance data. Through its web application and data feeds, clients can access the most complete solution for listed company intelligence on the market, with broader and deeper insights than ever before.

About Diligent

Diligent is the AI leader in governance, risk and compliance (GRC) SaaS solutions, helping more than 1 million users and 700,000 board members to clarify risk and elevate governance. The Diligent One Platform gives practitioners, the C-Suite and the board a consolidated view of their entire GRC practice so they can more effectively manage risk, build greater resilience and make better decisions, faster. Learn more at diligent.com.

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“The Investor Stewardship report reveals a critical insight: investor support has decisively shifted toward rewarding financial performance,” said Josh Black, Editor-in-Chief of Diligent Market Intelligence.