The so-called Big Three asset managers have been called a ‘cartel’ that controls U.S. corporations. Here’s the truth.
These investment products, which aim to replicate the performance of market indexes, have grown in popularity over the years thanks to theirIn the passive investing world, three asset managers reign supreme: Vanguard, BlackRock and State Street, which manages the SPDR line of index funds.
"They do own a large portion of the publicly traded shares of those companies, so that's true," says Daniel Sotiroff, senior manager research analyst for Morningstar Research Services."But then you need to take a step back and ask yourself why that is." "These companies own these shares on behalf of their investors," says Sotiroff."They don't own them for their own personal corporate reasons. They didn't just go out there with their own money and start buying up stakes in these companies."
Shareholders of a particular stock who may not be able to attend the shareholder meeting are allowed to vote by proxy — casting a mail-in ballot for the issues that may come up for vote during the company's annual meeting. These may include electing new board members, approving corporate moves, such as mergers or acquisitions, or setting executive bonuses.
Whether that's actually the case is up for debate. ESG proponents argue that preparedness for climate change, for instance, shows that a company is managing risk. Critics chalk up ESG policies as"woke" distractions getting in the way of profitable enterprises.
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