"This is a good year for shareholder proposals," said Laura O'Neill, SHARE's law and policy director.

It isn't just the number, but also the quality of well researched and well written proposals coming to the floor at corporate AGMs, said O'Neill. And with better proposals comes more acceptance and recognition from mainstream and institutional investors.

"What I've seen over time is definitely less tilting at windmills — that sort of dismissal of the idea that real or positive ideas for change can come from outside of the corporate executive suite," O'Neill said.

By consensus the biggest triumph socially responsible investors notched this spring was a series of votes that challenged management and boards of directors at Canada's big banks. At each of the five big bank AGMs, Kitchener-based Meritas Mutual Funds Inc. proposed that boards hold an advisory vote for shareholders on executive compensation. The idea that shareholders should get to weigh in on the rich salary, bonus and stock option packages offered to the CEO and his immediate team has been a hot topic in both Canada and the United States.

The Meritas proposal averaged 40.5 per cent of the shareholder vote. Shareholders get one vote for every share they own, which means the Meritas proposal had to have the support of big, institutional investors to rack up such an impressive vote total.

Though technically the votes came in under the 50-per-cent-plus-one threshold, bank boards of directors will have to seriously consider coming up with a counter-proposal on the issue to avoid being embarrassed next year.

The average vote total for shareholder motions has been eight per cent over the last three years.

Meritas CEO Gary Hawton called the sweep of the banks Meritas's most significant accomplishment over the last year.

"Does it make the marketplace more democratic? I would say yes, and I don't think that's a bad thing," Hawton said.

Even shareholder proposals that draw more traditional support levels of less than 10 per cent can be called successful. Les Soeurs de Sainte-Anne, a religious community in Quebec, were disappointed their proposal at the Barrick Gold Corp. AGM didn't draw institutional support they thought they had lined up, but the result was good enough to encourage them to continue their campaign. The sisters want Barrick to commission an independent study into the risk to local water sources posed by the massive Pascua Lama project on the mountainous border between Chile and Argentina. In the end the motion attracted 6.9 per cent of the vote, a high enough total to entitle the sisters to present the motion again next year.

Philippe Belanger, an analyst with the sisters' investment advisors Regroupement pour la responsabilité sociale et l’équité, said it is too early to say whether the sisters will propose their motion again next year. Meeting with Barrick management to discuss the issue is another possibility.

In fact, such shareholder engagement before motions reach the floor of an AGM is often the goal for socially responsible investors. Meritas got just such a result when it proposed a code of conduct for suppliers to Harry Winston Diamond Corp. With the company's agreement to develop such a code over the coming year, Meritas withdrew its motion.

"There's increasing willingness on the part of companies generally to engage with shareholders, particularly on social and environmental issues," said SHARE executive director Peter Chapman.

Looking ahead, SHARE is hoping to shake up the mutual fund industry by exposing "auto-pilot proxy voting." A study of mutual fund voting patterns since 2005, when companies had to make voting records public, found big mutual fund firms unwilling to vote against management.

Two big firms, Fidelity Investments Canada and TD Funds, voted with management on every single shareholder proposal in 2006 and 2007. There were 4,827 ballots cast at 286 companies, including votes on the appointment of auditors and boards of directors, during that period. One-sided results raise questions about whether mutual fund companies are really acting in the best interest of their unit holders, according to SHARE.

Mutual funds that market themselves to ethically motivated investors are most likely to support shareholder resolutions against management. Inhance Management, Ethical Funds and Meritas Mutual Funds all voted for shareholder proposals more than two-thirds of the time. But some conventional fund managers also showed a willingness to side with shareholders. CIBC Securities Inc. voted for more than a quarter of shareholder proposals and Acuity Investments sided with shareholders on nearly one-fifth of votes.

If mutual fund companies begin to take their proxy voting more seriously, Canadians may see a change in how corporate Canada responds to social and environmental issues, said Chapman.

"It has an impact on the way companies are governed and the way they understand their social and environmental obligations, and often on the kind of information that is disclosed to investors — all of which add up to better investment decisions and a win-win situation."