BlackRock’s voting record for this year – which reached a fresh low for ESG support – is “disappointing but not surprising”, according to ShareAction.
At the most recent AGM season, the world’s largest asset manager voted in favour of just 4.1% of shareholder proposals linked to environment and social issues, a fresh low for the giant.
Overall, the number of environmental and social-related proposals the firm could vote for grew from 455 to 493, but BlackRock rejected these for “lacking economic merit” and for being over-reaching, as reported by Reuters.
In 2023, BlackRock supported 6.7% of proposals, a sharp drop from the support for 47% of resolutions in 2020-21, although the number of resolutions has shifted much higher.
BlackRock’s 2024 Global Voting Spotlight said: “In our assessment, the majority of these [proposals] were over-reaching, lacked economic merit, or sought outcomes that were unlikely to promote long-term shareholder value,” echoing reasons it had given the previous year.
“A significant percentage were focused on business risks that companies already had processes in place to address, making them redundant.”
However, Felix Nagrawala, financial sector research manager at ShareAction, said BlackRock should be held to account.
“If other investors and the largest proxy voting advisors can take a much more progressive approach, why should the world’s largest asset manager be let off the hook?”
Nagrawala added: “Our research has shown BlackRock has repeatedly been one of the worst performers in recent years and seen its support of resolutions plummet. While they say the resolutions are too prescriptive and lack merit, in reality, we found most resolutions (three quarters in 2023) were just asking for more disclosure – hardly too much to ask for companies when it comes to systemic risks like climate change that is in the long-term interests of its clients.”
See also: BlackRock’s Fink: ‘It’s not our place to be environmental police’
In ShareAction’s Voting Matters report from 2023, BlackRock was flagged as consistently voting against ESG resolutions, and it has faced fierce criticism in the US for previously backing such proposals.
Last year, BlackRock’s CEO Larry Fink’s (pictured) annual letter to shareholders said it was not the asset manager’s place “to be the environmental police”, while in this year’s letter he skipped over the anti-ESG backflash the firm has faced and focused on “energy pragmatism”.
