BlackRock Extending Proxy Voting to IVV Retail Investors

BlackRock Inc., the world's biggest exchange-traded fund issuer, is extending voting rights to individual ETF investors, allowing them for the first time to offer input on shareholder proposals.

The firm, whose U.S. iShares unit manages $2.6 trillion in 408 ETFs, is starting with it's biggest fund, the $433 billion iShares Core S&P 500 ETF (IVV), the second-largest U.S. ETF. More than 3 million retail investor accounts holding $200 billion will be able to give input in proxy votes under the new program, the firm said today in a press release. Eligible voters could start the program as soon as this week.

The world's biggest ETF issuers—BlackRock, Vanguard Group and State Street Corp.—have rolled out proxy voting to individual shareholders in recent years to varying degrees. Those extensions largely came amid conservative criticism that the firms had gone too far in adopting environmental, social, and governance (ESG) factors in what investing choices were offered.

BlackRock first rolled out proxy voting for institutional investors two years ago. Following the ESG backlash, the asset manager last year supported a smaller number of ESG-related shareholder proposals than it had in previous years, according to its August 2023 report. BlackRock approved of about 7% of resolutions related to climate change and social issues, down from 21% that the company supported in 2022.

BlackRock Voting Policy

BlackRock currently uses the BlackRock Investment Stewardship Voting Policy to cast proxy votes. Individual investors will be able to “select from six third-party voting policies covering a range wide of voting preferences,” the statement said. They also can opt out of voting.

“We launched Voting Choice two years ago to further democratize investing and enable more investors to participate in shareholder voting,” Rachel Aguirre, head of U.S. iShares Product, said in the statement. “Today, for the first time, we’re able to unlock Voting Choice for millions of individual U.S. investors.”

The firm announced in June 2022 that it was expanding the proxy voting program to public and private pension plans, insurance companies, and endowments.

According to the firm, investors holding $598 billion in assets are currently using their voting choice program as of Dec. 29, 2023.

Contact Lucy Brewster at [email protected].