BlackRock’s ESG Shareholder Support Reaches New Low

BlackRock, the world’s largest asset manager, has reduced its backing for shareholder proposals related to environmental and social issues to a record low of 4.1% during the recent annual general meeting season, the company announced on Wednesday. Despite an increase in these types of proposals from 455 to 493 year over year, BlackRock rejected most for reasons similar to previous years.

In 2023, BlackRock supported 6.7% of such proposals, a steep decline from its 47% support in 2020-21, even as the number of resolutions surged. The “2024 Global Voting Spotlight” report cited that many proposals were deemed over-reaching, lacked economic merit, or were unlikely to enhance long-term shareholder value. Additionally, many proposals addressed risks that companies were already managing, rendering them redundant.

BlackRock’s approach to ESG issues has faced significant criticism, particularly from U.S. Republican politicians accusing companies of engaging in “woke capitalism.” As the next AGM season approaches, BlackRock has emphasised the importance of financial resilience while acknowledging that long-term success also depends on managing the transition to a low-carbon economy.

Overall, BlackRock supported 20 proposals this year, with only four related to climate and natural capital, while its general support for shareholder resolutions rose to 11% from 9% the previous year.