AGM resolution demands the food retailer sets targets to increase the proportion of healthy products it sells
Supermarket group Tesco is facing a shareholder resolution about health at its AGM on Thursday, from a coalition of institutional and retail investors calling for the food retailer to set targets to increase the proportion of healthy products it sells.
The resolution, co-ordinated by responsible investment non-governmental organisation ShareAction, is being co-filed by seven institutional investors including Robeco, JO Hambro, and Guys and St. Thomas’ Charity, along with 101 retail investors.
ShareAction claims severely obese people are three times more likely to be admitted to intensive care with Covid-19 and that Tesco, with 27% of Britain’s grocery market, plays a central role in shaping the nation’s diets and must reduce its reliance on unhealthy products for sales growth.
They also say Tesco’s performance on health issues lags behind some of its peers, and that new health regulations and consumer trends pose a risk to its business.
If the resolution is passed, it will require Tesco to disclose the share of total food and non-alcoholic drink annual sales by volume made up of healthier products and develop a strategy to increase that share significantly by 2030.
The resolution will also require Tesco to publish a review of its progress each year in its annual report from next year onwards.
Investors co-ordinated by ShareAction made similar demands at Tesco’s AGM last year and reported the company has not made any significant commitments or progress to date.
The resolution represents a marked escalation in the investors’ engagement with Tesco on this issue and is the first time a UK listed company has been challenged with a shareholder resolution on health grounds.
Date published: 9 February 2021