Barbara Novick of BlackRock, Inc., one of the largest and most powerful institutional investors in the world, wrote about CEO pay and the role of shareholders. Of particular note is her assessment of proxy advisors, making it clear that proxy advisor clients appreciate the analysis and recommendations but have their own views. Proxy advisors are…
Tag: institutional investors
A Catch 22 for Asset Managers
Jasmin Sethi writes about the impact of concentrated voting power and calls for better disclosure of the exercise of ownership rights: The big three—BlackRock, State Street, and Vanguard—are victims of their own size. As they have increased their assets under management, they have also increased their voting power as typically they vote the shares for…
Boaz Weinstein Sues BlackRock Alleging Corporate-Governance Failings – WSJ
Saba Capital Management, a $1.7 billion hedge fund run by Boaz Weinstein, has sued BlackRock Inc., BLK 1.63% arguing the world’s largest asset manager has moved to block outsiders from gaining board seats at three of its funds and effecting change.In two lawsuits filed late Tuesday, Saba alleged that BlackRock’s actions run counter to the…
New UK Rules for Improving shareholder engagement and increasing transparency around stewardship | FCA
The UK’s Financial Conduct Authority has issued new rules for institutional investor fiduciaries that impose new requirements for engagement and disclosure: We have introduced new requirements to improve shareholder engagement and increase transparency around stewardship. The requirements come into effect on 10 June 2019. Asset managers and life insurers will need to disclose and make…
Index Funds May be Able to Vote 41% of S&P 500 Shares in the Future | Corporate & Securities Law Blog – JDSupra
Research by Lucian A. Bebchuk, Harvard Law School, and Scott Hirst, Boston University School of Law, indicates three key index fund advisors could cast 34% of votes in the next decade at S&P 500 companies, and about 41% of votes at S&P 500 companies in two decades. The key index fund managers are BlackRock, Vanguard,…
We Three Kings: Democratizing Voting at the Index Fund Giants | Oxford Law Faculty
Law professor Caleb Griffin writes in the Oxford Business Law Blog offers three options for addressing the problem he sees in concentration of proxy voting rights in just a small handful of players, primarily index funds: Passive funds will soon own the majority of all U.S. equity assets, and the way they vote their proxies…
Financial Advisor IQ – Broker-Dealers Rebuked for “Web of Toxic Incentives” in Congressional Hearing on Reg BI
The broker-dealer business model is broken and won’t be fixed by the SEC’s proposed Regulation Best Interest. That was the picture painted by all but one of five witnesses called to testify on the effectiveness of the proposed rule at a Congressional hearing Thursday.“The brokerage business model, with all of these and other perverse incentives,…
CII Spring Meeting 2019
The Council of Institutional Investors meets in Washington DC every spring, and as fascinating and timely as the presentations and panels are, what goes on behind the scenes is increasingly even more significant. VEA Vice Chair Nell Minow made presentations at two of these behind-the-scenes events, discussing buybacks with members of the CII board and…
PIC struggles to improve quality of corporate governance
South Africa’s PIC pension fund adjusts its corporate governance priorities (emphasis added): More than half of the companies in which the PIC has a substantial investment ignore its views on the need for independent auditors.Almost half of them also ignore its view on what is, or is not, an acceptable remuneration policy, and a substantial…
