Briefing on amendment proposals to the Companies Act modifying rights to make a shareholder proposal

Since 2024, there have been discussions to amend the minimum threshold for shareholders to file a shareholder proposal. These discussions have gained momentum in 2025. It is possible that minimum thresholds may be increased, therefore limiting the possibility for shareholders to file a shareholder proposal. Based on recent trends, there could be a decrease of up to 80% to proposals from minority shareholders. 

If passed, some of the proposed amendments to the Companies Act would have significant implications for the relationship between investors and companies, particularly in the context of corporate governance and stewardship.

ClientEarth has published a new briefing, “Minimum shareholding thresholds”, outlining key aspects of the ongoing legislative discussions. The briefing analyses several proposals concerning the eligibility requirements for shareholder proposals and rules governing the exercise of voting rights at shareholders’ meetings, and examines their potential impact on investor engagement and corporate governance practices.

Key areas analysed in the briefing

Restrictions on shareholder proposal rights
If the current threshold allowing proposals from shareholders holding 300 voting rights were abolished and replaced with a 1% ownership requirement, submitting shareholder proposals at large listed companies could become significantly more difficult, including for institutional investors.

Risk of further formalization of shareholders’ meetings
Proposals to allow resolutions to be deemed adopted through advance voting procedures may raise concerns about limiting opportunities for dialogue, questions, and amendments during the meeting itself.

Potential expansion of existing imbalances
Limiting certain shareholder proposals while advisory resolutions initiated by companies remain permitted could further widen existing asymmetries between company-led and shareholder-led initiatives.

ClientEarth notes that while improving efficiency and reducing burdens on companies are stated objectives of the proposed reforms, there are also concerns that the deliberative nature of shareholders’ meetings and the effectiveness of investor stewardship could be affected.

The briefing provides an overview of the proposed amendments, their legislative background, and their possible implications for investors’ ability to exercise their rights