BlackRock to allow clients to pass-through their votes!

Pass-Through Voting YouTube Thumbnail

Here comes some big news from this “Pensions & Investments” article entitled “BlackRock gives institutional investors proxy-voting choices.” Also see this blog from Liz Dunshee, indicating that this change will apply to about 40% of BlackRock’s managed assets beginning January 1st. This note from Andreas Posavac drives the point home:

This is actually quite big. BlackRock will allow their clients, pension funds, mandates etc to choose from different proxy voting options. This is in line with the push and requirement for asset owners to become more active in not only voting, but also ESG-related matters incl. climate change and have an option to use Blackrock’s infrastructure, but also outside third parties now.

With the shift to passive investing continuing, and more ESG-integration required (either ideologically or due to legislation) this will be big. In some companies, the big three BlackRock, State Street and Vanguard account for more than 15% of the free float, hence active engagement and voting will have huge effects.

Question is: What will the others do now?