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Abstract

Because of their substantial equity portfolios, BlackRock, Vanguard, and State Street (the Big 3) are central players in corporate governance. It is, therefore, critical to understand how they vote. One puzzle is that their support for shareholder proposals on environmental and social matters appears to waiver. In 2020, for instance, BlackRock supported 11.1% of environmental proposals at S&P 500 firms. In 2021, it seemingly reversed course, supporting 55.2%. It then flipped again, supporting 32.1% in 2022. Such statistics suggest that the Big 3 are constantly changing their views on these topics. This Article seeks to better understand whether this is the case. Using a hand-collected dataset of the Big 3’s voting records with respect to S&P 500 firms from 2018–2022, we first describe the extent to which Big 3 voting has fluctuated. Second, we show that because the pool of proposals varies from year to year, and the companies targeted for such proposals also vary, summary statistics about Big 3 voting tell us little about whether they are changing their positions from year to year. Finally, to control for variation in the pool of proposals and in the pool of companies, the Article analyzes Big 3 voting only with respect to repeat proposals at the same firms. We find (1) that the Big 3 remained largely, but not wholly, consistent; (2) that when they changed their votes, it was usually to support proposals that they previously opposed; and (3) that, in some cases, changes on repeat proposals provide a meaningful explanation for year-over-year changes in their voting patterns.

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