About the 1792 Exchange
Spotlight Report on
Proxy Voting

About the Report

In the Spotlight Report on Proxy Voting, 1792 Exchange reveals the proxy voting records of all 50 states’ pension fund asset managers. It also summarizes and categorizes votes of all the states that disclose their votes on directly owned stocks. The database hundreds of controversial ESG-related resolutions on the “Votes to Watch” page. To learn more about our methodology and the limitations of this research, please view the methodology section at the bottom of this page.

What is proxy voting and why does it matter?

Roughly 75% of invested assets in U.S. stock markets are linked to retirement. These funds are typically managed by large financial services firms such as BlackRock, State Street, and Vanguard, each of which have trillions of dollars in assets under management. These and other investment firms manage public pension funds, private corporations’ retirement plans, college savings plans, and individual investors’ funds.

Most Americans are unaware that their investment managers often actively support ideological agendas masked under environmental, social, and governance (ESG) priorities by leveraging their investments to vote for ideological resolutions at shareholder meetings. Because these assets include public company stocks, asset managers have increasingly exercised the shareholders’ right to vote at the shareholder meetings on resolutions impacting the corporation – a system known as proxy voting.

In recent years, some managers such as BlackRock(1), blue state pension funds, and other activists who own or influence blocs of shares have weaponized shareholder resolutions, introducing and/or supporting controversial and distracting resolutions on climate goals, racial equity audits, abortion, LGBTQ+ advocacy, and more. These formerly banal corporate meetings are now exploited by progressive activists who seek to coerce businesses to promote their agendas. Corporate boards and management who want to focus on business are caught in the crosshairs.

As fiduciaries, investment managers are legally obligated to manage asset owners’ money for the highest returns, not for any non-financial objectives. Ideological resolutions distract management and can harm corporate returns and stock values, thus harming shareholders. State pension funds and defined benefit plans are for first responders, teachers, and other state employees. Taxpayers are also on the hook if these pension funds’ returns are reduced and miss targets for any reason, including when public corporations make decisions for non-financial reasons or are forced to do so by asset managers, activist shareholders or government.

In many cases, pension funds and investment firms outsource proxy voting duties to the proxy advisory duopoly of Institutional Shareholder Services and Glass Lewis. These two firms control over 90% of the market and consistently promote ESG agendas that can harm investment returns. 1792 Exchange’s research shows that these proxy advisors often vote for these ESG resolutions and advise others to do the same, even in funds not explicitly marketed to follow ESG objectives.

Pensioners, retirees, state legislators, other elected officials, and taxpayers remain in the dark about the politicization of pension funds by asset managers because few states publicly disclose their pension funds’ proxy voting records. 1792 Exchange encourages states to pass laws to protect pensioners and taxpayers, including requiring asset managers to fulfill their sole interest of fiduciary duty. States also must increase transparency and ensure pension funds’ proxies are not voted for non-financial reasons.

What you can do about it

Individual investors can stay informed, learn of the upcoming shareholder meetings in their portfolio, and vote their shares by using the Proxy Navigator app, or other resources.

Public employees enrolled in state pension plans should contact the pension fund’s board and staff to clearly communicate that they expect the prioritization of financial returns, not ESG or other non-financial goals or distractions. They should request that the assets be removed from managers and funds prioritizing ESG. Individuals working for private corporations should contact their retirement plan sponsor and investment manager to do the same. Those with IRAs also should evaluate their asset manager and individual investment funds and consider switching if necessary to avoid ESG investing priorities.

Governors and others who appoint pension board members must vet potential members for their sole focus on fiduciary duty and rejection of ideological and non-financial factors. The board must vet potential staff in the same way.

Pension board members and staff should demand the plan’s asset managers and/or proxy advisor vote against ESG and other harmful resolutions. States should consider switching proxy advisors and/or asset managers as necessary to maximize returns and avoid promoting ESG agendas through proxy voting.

States should pass legislation to prohibit ESG and non-financial considerations in investments and retain the right to vote their own proxies or direct the votes. Every state pension fund should disclose its proxy voting records to the public. 1792 Exchange lists every state’s pension fund or retirement system boards, including the structure and composition and a link to the entity’s website. We encourage pension funds to follow the lead of states like Florida and Texas, which disclose their proxy voting records.

Asset managers should stop voting for ESG resolutions at shareholder meetings, particularly with non-ESG funds. Asset managers should uphold their fiduciary duty to maximize investment returns and stop voting for ideologically motivated shareholder resolutions. Asset managers should discontinue their “engagements” with companies intended to force behavior changes on controversial, non-financial matters.

Proxy advisory firms like ISS and Glass Lewis must stop supporting progressive agendas and politicizing retirement funds, especially for funds not explicitly labeled as “ESG” funds.

Download Methodology PDF


[1]BlackRock’s proxy voting record, while concerning, does not reflect the full extent of its role driving stakeholder capitalism and ESG activism using asset owners’ funds and power. BlackRock is the most powerful force politicizing and harming corporations and shareholders. In fact, as a result of controversy, divestments, legal investigations, and reputational damage, BlackRock has toned down its ESG rhetoric and narrowed its support to many of the worst ESG-related resolutions in the past year. Whereas many states supported more ESG-related resolutions than BlackRock, the world’s largest asset manager has continued to prioritize stakeholder capitalism priorities into its corporate engagement efforts intended to force behavior. It also voted against 255 directors and against 319 companies for climate-related concerns in the 2020-21 proxy year. BlackRock also voted against 1,862 directors for “lack of board diversity” that year. Outside of proxy voting, BlackRock engages in corporate lobbying efforts to promote ESG goals, including 2,330 engagements at companies in the 2020-21 proxy year related to climate and “natural capital.” BlackRock is also a member of the Net Zero Asset Managers Initiative, a signatory of Climate Action 100+, and a Ceres Network Member, among other ESG compacts and coalitions. These alliances manipulate capital markets, hamstring the economy, increase energy and food costs, and may violate fiduciary duty and antitrust laws. For more on BlackRock, please click here to see the company’s Corporate Bias Rating.

Disclaimer: The information contained in this report, ‘Proxy Voting,’ is intended for educational purposes only and does not constitute financial or investment advice. Click here for the full disclaimer.

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