Battling the Board: Shareholder Activism, Sustainability and Social Movements

The boards and management of listed companies are under growing pressure from investors to address urgent ESG issues, including the transition to renewable energy. In Australia, the country’s economic reliance on mineral extraction places questions of environmental harm and the rights of Indigenous communities at the forefront of corporate governance. Yet, unlike in comparable liberal market economies such as the United States or the United Kingdom, where ESG shareholder activism has become an established feature of corporate governance, this form of investor pressure is a relatively new phenomenon in Australia. This puzzle, the drivers of the sudden emergence of ESG shareholder activism in a financial-legal system historically designed to stymy investor voice, motivates the research. The study identifies significant governance gaps between societal expectations and corporate behaviour, highlighting how market-based activism is reshaping relations between corporations, investors, and the state. By integrating social movement theory and corporate governance frameworks, the research demonstrates the potential of shareholder activism to play a key role in the transition to net zero. At the same time, it shows how successful social movements can be undermined or redirected by government intervention, underscoring the contested balance of power between public authority and private market actors. This research contributes to our understanding of how shareholder activists leverage corporate governance mechanisms to shape political-economic outcomes, with direct consequences for sustainability and climate change. By contrasting Australia’s late but rapid embrace of ESG activism with the longer trajectories in other liberal market economies, the study illuminates how institutional design, state intervention, and market pressures interact differently across contexts. In doing so, it highlights the evolving dynamics between markets and the state in energy transitions, and the ways in which activism both challenges and complements existing governance structures.