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How everyday investors may soon vote away ESG

By illuminem briefings 🌎

Sep 18 2023 · 1 min read

Illuminem Voices
Sustainable Finance · ESG · illuminemX

illuminem summarizes for you the essential news of the day. Read the full piece on the New York Post or enjoy below

🗞️ Driving the news: BlackRock, the world's leading asset manager, plans to give ordinary retail investors greater control over how shares linked to their funds are voted at corporate annual meetings
• This is a groundbreaking move, especially as these votes are becoming more politically charged, with an emphasis on environmental and social policy positions

🔭 The context: BlackRock's shift aims to counter criticisms that it has used its enormous shareholder voting power to drive companies toward policies favored by progressive elements
• Notably, rivals like Vanguard and State Street have already offered a level of customized voting for some investors

🌍 Why it matters for the planet: Investment giants like BlackRock have been significant players in the ESG (environmental, social, governance) movement, using their influence to push corporations to prioritize areas like environmental protection and racial justice
• Such decisions in the financial world impact global trends and corporate behavior on pivotal issues, including climate change

⏭️ What's next: BlackRock's move might prompt other firms to adopt similar policies, reflecting a broader shift in how asset managers engage with issues of environmental and social justice
• However, there's conservative pushback against these progressive actions, with entities like Florida pulling assets from BlackRock citing the firm's activism

💬 One quote: “The battle over 'woke' issues such as the environment or race relations has found a willing home in the hands of large investment firms such as BlackRock.” (Jim Copland, senior fellow at the Manhattan Institute)

📈 One stat: The "Big Three" asset managers, including BlackRock, control almost a quarter of the shares in the S&P 500, representing around 85% of the total U.S. stock market

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