Dive Brief:
- BlackRock is allowing its iShares investors to exercise voting power during the proxy process, the company announced Tuesday. The nation’s largest asset manager said the expansion of the program now includes investors with a total of $2.6 trillion in assets under management.
- Investors can choose and implement their own preferred policy; take a hybrid approach that allows them to choose whether to follow the investment stewardship team depending on the topics and companies they most care about; choosing from a set of third-party voting policies; or continuing to allow BlackRock’s team to make their voting decisions.
- It is the first time individual investors in BlackRock’s shareholder accounts will be able to participate in the proxy voting process. The expansion of the Voting Choice program comes as the number of ESG-related shareholder proposals continue to rise at company boards, though approvals fell last year.
Dive Insight:
Clients who participate in the Voting Choice program, which launched in 2022, represented $598 billion in assets under management, as of Dec. 29.
Customers who choose not to participate or are in jurisdictions where the option is not available will have the firm’s investments stewardship team continue to vote for them. BlackRock said it will give investors four options for how to approach their proxy voting decisions.
The broadening of the program’s access will empower investors and make proxy voting both easier and more accessible, Joud Abdel Majeid, global head of BlackRock investment stewardship, said in the release.
“I’m thrilled that today more than three million additional shareholder accounts have an efficient solution for participating in proxy voting if they choose,” she said.
The expansion could also allow investors to take a more active approach to environmental, social and governance resolutions set forth at companies. The program was expanded to BlackRock’s iShares Core S&P 500 ETF index.
Should investors choose to follow a third-party voting policy, the U.S. pilot program gives them six options from two different proxy voting services: Three from Glass Lewis and three from the Institutional Shareholder Services Inc.
Glass Lewis’ available policies include a benchmark voting policy, that says it recognizes the importance of environmental and governance oversight, and a climate-aligned voting policy along with one focused on corporate governance. ISS’ available proxy voting policies include one aligned with the principles of social responsible investment.
A record number of proposals were submitted and received votes at company boards in 2023. The dip in approval was attributed in part to the voting habits of large institutional investors like BlackRock. BlackRock’s support for environmental and social proposals fell from 20% in 2022 to 7% in 2023.
