Activist investors are pushing technology companies to explain how they’re reconciling surging electricity demand for AI with their climate commitments. Shareholders at Amazon.com Inc. voted on a proposal asking the firm to disclose more information. Voting is open for shareholders at Meta Platforms Inc. and Alphabet Inc. and will conclude later this month and in early June at each company’s annual meeting.
Support for such initiatives has declined in recent years amid underwhelming outcomes and a broader political backlash in the US against environmental, social and governance investing. Heavyweight investment firms, including BlackRock Inc., Vanguard Group Inc. and State Street Corp., have also pulled back from these types of measures.
The new effort shows that green shareholder activism, while quieter than in its heyday in the early 2020s, persists. The proposals were filed by the nonprofit As You Sow, along with Presbyterian Life & Witness, Mercy Investment Services and Trillium Asset Management.
“In the AI race, tech giants risk undermining their climate commitments at precisely the moment disciplined, long-term decision-making matters most,” said Andrea Ranger, director of shareholder advocacy at Trillium Asset Management. “Shareholders are asking for a credible strategy that preserves both climate goals and leadership in the AI economy.”
In each proposal, shareholders request that the company “issue a report explaining how it will meet the climate change-related commitments it has made on greenhouse gas emissions, given the massively growing energy demand from artificial intelligence and data centers.”
All three companies recommended that shareholders vote against the proposals in their annual proxy statements, arguing that they already make relevant climate disclosures to shareholders. Meta and Alphabet declined to comment further. Amazon said support for the proposal was lower than that for a similar measure last year.
The ultimate goal of bringing the proposals is to spur more development of clean energy to power AI, said Kelly Poole, climate and energy coordinator at As You Sow, which promotes corporate responsibility through shareholder advocacy.
“These tech companies need to commit to ensuring that no new fossil fuels are built to meet the power demands of their data centers,” Poole said.
History shows shareholders face challenges in driving change. Most resolutions fail to win majority support, and even successful measures are typically nonbinding, meaning companies aren’t required to comply. Still, activist investors can pressure companies into strengthening governance practices. In recent years, such campaigns prompted FedEx Corp. to review its executive severance policies and helped persuade Netflix Inc. to require directors to stand for annual re-election.
The number of climate and environmental resolutions filed went up during the Biden administration: “As Biden took over, you saw a flood of these proposals,” said Rob Du Boff, a Bloomberg Intelligence ESG analyst, adding that they peaked in 2024 before tapering off.
Support began to fall off before that. The decline isn’t just a US phenomenon. Canadian activist investor Investors for Paris Compliance said this week it is winding down operations because it was unable to deliver net-zero objectives or manage climate risk at the system level without broader legal and regulatory action.
“We set out to test whether investor accountability could meaningfully enforce the wave of voluntary net-zero commitments being made by Canada’s financial institutions and largest emitters,” the group wrote in a report. “We found that this approach only works at the margins.”
Winning 50%-plus backing for shareholder proposals may be more difficult at Meta and Alphabet because both companies use dual-class share structures that give founders and executives outsize voting power, allowing them to maintain tight control over corporate decisions.
For Poole, the resolutions are more about giving investors the opportunity to signal concern and educate others on the risks. That alone can enact change, she said. “It’s less about the specific percentage win of the proposal or how many votes you get,” Poole said.
In addition to climate and other environmental concerns, the data center buildout poses a governance issue, said Jill Fisch, a professor of business law at the University of Pennsylvania.
A board of directors can’t say it’s committed to net zero while also building plants that create a climate problem, she said: “Those two statements are inconsistent. That’s not good governance.”
As the construction of AI infrastructure accelerates, tensions have risen between the tech industry and communities ahead of the midterm elections in November, driven by concerns about rising electricity costs, grid strain and water use tied to data centers. The friction poses a financial risk for companies if projects are delayed or halted because of local opposition, Fisch said.
“Highlighting the issue and identifying the risk to other investors potentially has an impact on stock prices,” she noted.
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