Better for Animals: The Evidence Behind Investor Advocacy

12 minute read

This month, we’re spotlighting the evidence behind Investor Advocacy as part of our ongoing Better for Animals research.

Better for Animals: Background

Animal Charity Evaluators’ Better for Animals: Evidence-Based Insights for Effective Animal Advocacy resource is an ongoing project in which we distill key research on different animal advocacy interventions to help us evaluate their impact in different contexts. We have made this research publicly available to support informed decision making about how to help the most animals. You may read more about the methodology in our recent announcement.

This is a living document and we want to make it as helpful, accessible, and up-to-date as possible, so please feel free to reach out with feedback! To keep up to date with ACE’s research and the work of the amazing organizations that we support, be sure to sign up for our mailing list.

To help make this information more accessible to a wide range of audiences, we are spotlighting one intervention each month through a series of social media and blog posts. This month we are focusing on the evidence around investor advocacy.

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Intervention Spotlight #10: Investor advocacy

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What is this intervention?

• This intervention covers three tactics: divestment (withdrawing or withholding capital from companies that harm animals), impact investment (directing capital toward companies developing solutions such as alternative proteins), and shareholder advocacy (using shareholder rights to influence companies from within). These tactics aim to reduce animal suffering by limiting harmful industries’ access to capital, stigmatizing animal agriculture to build public and political support for change, and pressuring companies to adopt higher welfare standards or shift toward animal-free products.
• In practice, this summary focuses primarily on divestment and shareholder advocacy, as these appear to be the tactics most commonly used by animal advocacy organizations and the ones for which the most evidence is available.
• This evidence review does not include government investments or subsidies; these are covered in our “Government outreach” evidence review.

Summary: What is our overall assessment of this intervention? How confident are we in this assessment?

Overview

• Ethical investing or divestment generally appears to have limited direct impact; i.e., they appear unlikely to directly and measurably change targeted companies’ share prices or access to capital. This is primarily due to market efficiency, with other investors likely to fill the gap left by socially conscious ones. Divestment may still have value if used strategically to publicly highlight the harms an industry causes and to build momentum for the broader advocacy movement, especially when paired with efforts to ensure follow-through and accountability. Indirect benefits — such as reputational damage that deters a company’s business partners, employees, and customers — may also arise from the stigmatization of a certain company or industry, though the empirical evidence for such effects is not firmly established. Of the available tactics, shareholder advocacy appears most promising, as it allows engaged investors to influence harmful companies from within, with relatively low costs and a modest but meaningful success rate.

Evidence & confidence assessment

• Our research indicates that there is currently a small evidence base regarding investor advocacy relative to other animal advocacy interventions. Shareholder advocacy appears to be a fairly novel animal advocacy strategy, and we found little information relating to its effectiveness in different contexts. There is a larger body of evidence — including theoretical models, empirical studies, and qualitative observations — pertaining to other social causes beyond animal advocacy. We expect much of this evidence to be reasonably applicable to animal advocacy, as the underlying financial mechanisms (such as market efficiency and shareholder rights) are not cause-specific. However, differences in public attitudes toward animal agriculture — compared to other causes such as climate change — may limit the transferability of findings on stigmatization and movement-building. Our current confidence in our overall assessment is therefore moderate.

Context dependency and factors that make the intervention stronger/weaker

• We expect the effectiveness of this intervention to vary significantly depending on the context and the approach taken.
  • We believe this intervention is likely stronger when:
    • Investments or divestment campaigns target inefficient markets such as angel investing or development banks, where a single investor can have a large impact.
    • Campaigns use investment or divestment to stigmatize animal agriculture and rally broader movement support.
    • Investors focus on problems that receive little attention or funding from other investors, have useful insider knowledge, or can provide non-financial help like advice or networks.
    • Shareholder advocacy pressures companies that have made public welfare or climate commitments, creating clear accountability.
  • Conversely, the intervention is likely weaker, or may have unintended negative consequences, when:
    • Investments are made in large, efficient markets where individual actions have little influence.
    • Divestment messaging focuses on carbon emissions alone, potentially encouraging investors to move capital into industries that harm more animals.
    • Shareholder pressure targets companies without public commitments, leaving little leverage for change.

Complementary interventions

• Investor advocacy is frequently used in tandem with interventions like government outreach. Effectiveness likely differs depending on the combination of interventions, so we recommend reading the government outreach evidence review for context.

Priorities for future research

• Further research into the effectiveness of this intervention specifically for animal advocacy would be valuable, including additional case studies of organizations or investor groups that have trialed this approach, the degree of success they achieved, and the factors that may have influenced the outcome.

In depth

What does the research say about how effective this intervention is?

• Note that most of the following points relate to social causes more broadly, and are not specific to animal advocacy.
• Investor advocacy — whether by divesting from harmful companies or investing in more beneficial ones — appears to have limited direct impact on targeted companies’ share prices, cost of capital, or behavior. Economic theory suggests that in an efficient market, if investors avoid purchasing stocks in a particular company, the price of those stocks will decrease. This lower price incentivizes other profit-driven investors to purchase the stocks, driving the price of the stocks back up to roughly their original value.¹ Likewise, an investment in a beneficial company is likely to merely displace another profit-driven investor.² This theoretical argument against the direct impact of such investment decisions also appears to be supported by empirical research; according to a 2022 review by Animal Ask, studies have found evidence of short-term effects on share prices, but little evidence of longer-term effects.³
• A notable empirical study reinforces this: Researchers examined the impact of firms being included in, or excluded from, the FTSE USA 4 Good Select Index (a leading socially responsible index). Because funds that track the index automatically sell shares of excluded firms, exclusion acts as a real-world instance of large-scale divestment. The researchers found no detectable effect of divestment on the cost of capital of targeted firms. The researchers estimated that socially conscious investors would need to control more than 80% of all investable wealth to shift a targeted firm’s cost of capital by even 1%. Given the low likelihood of this, they concluded that divestment is unlikely to alter corporate behavior directly.⁴
• Researchers and advocates have pointed to the potential indirect impact of divestment campaigns, in particular the stigmatization of the target industry. An in-depth study on the impact of divestment on fossil fuel companies describes various concrete impacts of widely publicized stigmatization of companies.⁵ For example: their bad image may deter suppliers, business partners, potential employees, customers, and government partners; shareholders can demand major structural and management changes as a result; and they may be weakened when competing for public tenders or engaging in negotiations with suppliers. The researchers also report the historic success of various divestment campaigns in bringing about restrictive legislation — for example, the divestment campaigns against companies operating in apartheid South Africa are considered to have contributed to the introduction of the US Comprehensive Anti-Apartheid Act of 1986.
• A more recent systematic review of the mechanisms of investor impact reached a more cautious conclusion.⁶ The authors found that the indirect impacts of investment decisions lacked robust empirical support; by contrast, they found compelling evidence for the impact of shareholder engagement (discussed below). We also note that it is hard to assess the specific role of divestment in broader campaigns that entail a variety of advocacy tactics.
• Additionally, Animal Ask argues that if indirect impacts such as stigmatization are the main impacts of divestment campaigns, it is likely to be more effective to pursue interventions that can achieve this more effectively while also delivering greater direct impact, such as campaigns for policy reform.⁷
• Other researchers have argued that divestment is actively counterproductive, as it leads to the most powerful, harmful companies being increasingly owned by investors who only care about profit, without any socially conscious shareholders who could use their power — for example, by filing shareholder resolutions, voting at annual general meetings, and engaging directly with management — to improve the companies’ policies from within.⁸
• As such, a potentially more effective alternative to divestment is shareholder advocacy. This involves socially conscious investors investing in potentially harmful industries so that they can be in a better position to change them from within, or reaching out to a company’s existing shareholders to encourage them to use their influence.
• The systematic review on investor impact found that the success rate of shareholder requests ranges from 18% to 60% across the five studies they reviewed, which is significant given the potential impact of success and the low cost of making such a request.⁹ Of the evidence they reviewed, the most granular comes from a study of more than 2,000 environmental, social, and governance engagements (i.e., instances in which investors directly contacted a company to request specific changes to its practices) with US companies, which recorded an overall success rate of about 18%. This rate was higher for governance requests than for environmental and social ones, and was higher when actions involved repeated engagement and collaboration among investors.¹⁰
• A 2019 study tested whether environmental activist investing appeared to result in concrete outcomes and found that plants belonging to targeted companies reduced their toxic chemical releases by an average of 13% relative to comparable non-targeted plants.¹¹
• The nature of corporate structures and regulations mean that shareholder advocacy is much less feasible in most countries outside of North America and Europe, although pressure on companies in those areas can lead to changes throughout their global supply chains.¹²

Cost-effectiveness

• We found no cost-effectiveness estimates for this intervention.

Strength of evidence

• Shareholder advocacy appears to be a fairly novel animal advocacy tactic, and we found little information relating to its effectiveness in animal advocacy specifically. However, there is a larger body of evidence — including theoretical models, empirical studies, and qualitative observations — pertaining to other social cause areas beyond animal advocacy. We relied heavily on the two evidence reviews conducted by Animal Ask on divestment and shareholder advocacy, and the studies cited in those reviews. In addition, much of the available evidence is observational, and investment actions typically occur alongside broader campaigns and market trends, making it difficult to determine the causal effects of these tactics.

Under what conditions is this intervention more or less effective?

• Note that the following points all relate to social causes more broadly, and are not specific to animal advocacy.
• Investor advocacy is likely to have greater direct impact in inefficient markets, such as angel investing, where there are fewer buyers and sellers so the actions of one major investor can have a much greater impact than in larger markets.¹³ It is also likely to be more effective for development banks, as without development bank support, companies would probably be forced to apply for loans from commercial banks instead. Commercial loans are not subsidized by governments and therefore likely to be provided on worse conditions (e.g., higher interest rates), with negative implications for the company’s profits.¹⁴
• Otherwise, investor advocacy appears to be more effective when seeking to capitalize on its main indirect impacts; i.e., when actively seeking to stigmatize the target industry and to rally the movement — for example, by providing advocates and the public with concrete actions to take (such as petitioning universities or pension funds to divest) and generating media attention. Impact investment also seems to be a better fit for those who work on an important problem that is neglected by other investors, who have an informational advantage over other investors that allows them to identify promising opportunities, and who can also offer non-financial support to the company, such as advice or access to networks.¹⁵
• Divestment efforts often lobby investors to divest on environmental grounds. This should be framed in such a way as to convince investors to divest from animal agriculture entirely, not just from the types of animal farming that produce the highest emissions. This is to avoid investors shifting their investments from, e.g., the cow/buffalo meat industry to industries that have lower emissions, but that affect a far greater number of animals (such as the chicken or fish farming industries).¹⁶
• Meanwhile, shareholder advocacy seems likely to be particularly effective when shareholders pressure companies to follow through on existing public welfare or climate commitments to which they can be held accountable. ¹⁷ It is also more likely to be effective when accompanied by a broader advocacy campaign that can highlight to the company and its shareholders the salience and importance of the relevant issue.¹⁸
• Shareholder advocates are more likely to achieve success when they can highlight that making the requested changes will ultimately be to the company’s benefit and not meaningfully affect share prices.¹⁹
• Shareholder advocacy is more likely to be effective when the advocates own a significant proportion of shares, though this is not essential.²⁰
• Investment actions are more likely to be successful when they are coordinated among a group of investors with a cohesive ask. Coordinated shareholder engagement of this kind is already organized within the animal agriculture sector by investor networks such as the FAIRR Initiative, a coalition of over 400 institutional investors, representing over US$90 trillion in managed assets, founded in 2015.

Our priorities for improving this evidence review

• To improve future iterations of this evidence summary, we plan to:
  • Include more case studies of divestment and shareholder advocacy in action.
  • Include more evidence on how animal advocacy organizations can persuade investors to take action.

Last updated June 8, 2026

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1. Carpendale (2022)  

2. Hillebrandt & Halstead (n.d.)  

3. Carpendale (2022); Hillebrandt & Halstead (n.d.)  

4. Berk & van Binsbergen (2024)  

5. Ansar, Caldecott & Tilbury (2013)  

6. Kölbel et al. (2020)  

7. Carpendale (2022) 

8. Carpendale (2024)  

9. Kölbel et al. (2020)  

10. Dimson, Karakaş & Li (2015)  

11. Naaraayanan et al. (2019)  

12. Carpendale (2024)  

13. Carpendale (2022); Hillebrandt & Halstead (n.d.)  

14. See for example World Economic Forum (2025)  

15. Hillebrandt & Halstead (n.d.)  

16. Carpendale (2022)  

17. Carpendale (2022) ; Balk (2024)  

18. Carpendale (2022)  

19. Carpendale (2022)  

20. Kölbel et al. (2020)  

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