Following criticism, the likes of State Street, Vanguard and BlackRock are changing tack and bulking up governance teams. Listen to the companies themselves and you might think the days of outsourcing voting policy to proxy advisers such as ISS are over. Glenn Booraem, Vanguard’s head of corporate governance, describes his colleagues as “passive investors but active owners”.
Data from Proxy Insight show that passive investors are still finding their voice. Between July 2016 and July 2017, 91.5 per cent of BlackRock’s votes were in favour of management proposals — only slightly below the 92.3 percent approval rate the year before. State Street and Vanguard’s voting records follow the same trend.