Written by Ross Carver
(Reuters) – Vanguard supported just 2% of U.S. companies’ shareholder resolutions on environmental and social issues this year, down from 12% last year, a top mutual fund manager said on Monday This spurred a decline in the support of the whole family.
Vanguard said the drop in support reflects an increase in the number of proposals (359 this year, up from 290 last year) and that improved corporate disclosures have made many resolutions unnecessary.
Pennsylvania-based Vanguard, which manages $8.2 trillion, has become a leader in deciding whether companies should take steps such as curbing greenhouse gas emissions and reviewing workforce diversity.
Support among U.S. companies for shareholder resolutions calling for such measures has declined this year, with top asset manager BlackRock reporting that only 7% supported mostly advisory measures, up from 22% last year. He said it had decreased.
Vanguard’s decline in approval ratings was even more severe. Like BlackRock, Vanguard pointed to new securities regulations that will make it harder for companies to remove questions from ballots. Vanguard also said in a note on its website that many of the resolutions call for unnecessary changes.
“In some cases, even though the proposal posed a material risk to the company, the board is already adequately overseeing that risk and has demonstrated evidence of oversight through robust disclosure, or Vanguard confirmed that it had put in place practices that substantially met the requirements, Vanguard said.
Vanguard and BlackRock have come under fire from conservative U.S. politicians who say they are putting too much emphasis on sustainability issues, and liberal activists who say they are doing too little to address global issues.
Like BlackRock, Vanguard declined to say how the criticism influenced this year’s vote, but said its approach to evaluating shareholder proposals has been “consistent over the years.”
(Reporting by Ross Kerber; Editing by Diane Craft)