Pooled fund split voting gains further support

January 28, 2022

As more pension schemes have embraced low cost index investment in recent years, many pension scheme trustees have been calling for asset managers to find a way of ensuring their voting and engagement is aligned with the wishes of their beneficiaries, regardless of whether the schemes are invested in segregated mandates or pooled funds. Leading pension funds such as Railpen, numerous local government pension schemes as well as the Association of Member Nominated Trustees have done important work in this area.

We were delighted therefore to see in BlackRock's annual client letter, CEO Larry Fink called not only for global companies to embrace sustainability but also underpinned the importance of supporting stewardship and enabling voting rights for investors in pooled funds.

In the letter Fink explained that BlackRock was “pursuing an initiative to use technology to give more of our clients the option to have a say in how proxy votes are cast at companies their money is invested in”. The asset manager already offers the facility to “certain institutional clients” and is “working to expand that universe", Fink added.

BlackRock’s introduction of split voting in pooled funds is certainly a welcome and important boost for governance processes for pension funds and other institutional investors coming almost one year after Minerva Analytics' innovative split voting technology was deployed in partnership with asset manager DWS and institutional investment platform AMX to enable pooled fund investors have cast AGM votes in proportion to their fund ownership and with a fully bespoke voting policy.

Since then the AMX/Minerva solution has garnered numerous industry awards for innovation and we continue to move ahead with partnership with like-minded organisations keen to let asset owners have their say.

BlackRock's embrace of split voting is a significant and welcome development. As BlackRock's CEO stated, split voting “could bring more democracy and more voices to capitalism. Every investor deserves the right to be heard.” We completely agree. Fink also highlighted “significant regulatory and logistical hurdles” to split voting. The success of Minerva’s voting technology shows what can be done, today.

To find out more about Minerva Analytics’ award-winning split voting technology, say hello@minerva.info.