Are BlackRock and Vanguard Too Big and Powerful?

Are BlackRock and Vanguard Too Big and Powerful?

How big index fund and ETF providers have increased their sway over publicly-traded companies while potentially discouraging competition. What can be done about it?

Topics covered include:

  • How market share for assets under management has become increasingly concentrated with big fund complexes like Vanguard and BlackRock
  • What is a fiduciary relationship and how do asset managers serve as fiduciaries
  • Why do investors in index funds and ETFs have no input as to how fund sponsors vote on shareholder proposals
  • What percentage of outstanding shares do Vanguard and BlackRock own of publicly traded companies like Apple, Target, or gun manufacturers
  • How Vanguard and BlackRock use engagement and voting policies to influence publicly traded companies, particularly when it comes to climate risk and diversity
  • How ownership by Vanguard and BlackRock in publicly-traded companies in the same industry could discourage competition.
  • What can be done through regulation or through individual action to reduce Vanguard and BlackRock's influence


For more information on this episode click here.

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Show Notes

What BlackRock, Vanguard and State Street Are Doing to the Economy by Farhad Manjoo—The New York Times

Investment Company Fact Book

World's Top Asset Management Firms—ADV Rating

West Virginia Treasury Drops BlackRock Over Stance on Climate Risk by Alicia McElhaney—Institutional Investor

How an Organized Republican Effort Punishes Companies for Climate Action by David Gelles and Hiroko Tabuchi—The New York Times

The Future of Corporate Governance Part I: The Problem of Twelve by John C. Coates, IV

Larry Fink’s 2022 Letter to CEOs: The Power of Capitalism

BlackRock's gun money by Dan Primack—Axios

Investment Stewardship 2021 Annual Report—Vanguard

Proxy Voting Policy for U.S. Portfolio Companies

Anticompetitive Effects of Common Ownership by José Azar, Martin C. Schmalz, and Isabel Tecu

Common Ownership and Industry Profitability: A Crossindustry View by Haifeng Wang, Jan-Carl Plagge, James Rowley, Roger A Aliaga-Diaz

How ESG investing came to a reckoning by Harriet Agnew, Adrienne Klasa and Simon Mundy—Financial Times

Related Episodes

148: Is Your Financial Advisor Loyal to You?

234: Index But Don’t Herd

340: Climate Change, ESG, and What Should Investors Do?

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