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#BlackRock letting more clients vote in dramatic move

“BlackRock letting more clients vote in dramatic move”

BlackRock, the world’s biggest asset manager, said Thursday it would expand the number of clients eligible to choose how to vote at company annual meetings on everything from executive pay to climate strategy.

The “Voting Choice” program announced last year by the $8 trillion asset manager could reshape corporate elections both by making shareholders more involved and by diminishing the political criticism BlackRock faces from liberals and conservatives alike.

BlackRock said in a statement that at the end of September clients with around $1.8 trillion in equity index assets managed by the company were eligible for voting choices and that clients with $452 billion were doing so.

“My hope is that in the future, every investor — ultimately including individual investors — has access to voting choice, if they want it,” Chief Executive Larry Fink said in a letter to clients and company chief executives seen by Reuters.

BlackRock CEO Larry Fink
BlackRock CEO Larry Fink has been facing criticism from liberals and conservatives.
REUTERS

“If widely adopted, it can enhance corporate governance by injecting important new voices into shareholder democracy,” Fink wrote.

Other big fund firms have also experimented with making shareholders more involved with voting. Last month for instance Charles Schwab’s asset-management arm said it would start polling shareholders of certain funds about their voting preferences.

On Wednesday, BlackRock rival Vanguard Group also said it will seek client feedback and explore how investors in several equity index funds could vote directly. “Our clients have diverse perspectives, and a growing number would like the option to weigh in on how their index funds vote,” Vanguard said in a statement.

Participants in BlackRock’s program can control how their shares are voted at corporate annual meetings, align their shares with an outside advisor’s voting recommendations or leave the choice with BlackRock’s own stewardship team.

Going forward, clients would be able to choose to follow advice from proxy advisor Glass Lewis as well as Institutional Shareholder Services, BlackRock said in an update on the program.

In addition, BlackRock said it would offer voting choice to more investment strategies and work with investor communications platform Proxymity to extend choice to retail investors in some British mutual funds. Ultimately Fink wrote he hopes to offer choice to all individual investors.

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