Recently, BlackRock released its “2024 Investment Stewardship Annual Report” – here’s a 25-page executive summary. Here are six lessons learned – although note this is all about last year; not the latest proxy season:
1. Corporate governance remains a core focus. In 2024, BlackRock’s stewardship engagements largely centered on governance themes – like board quality, strategy, financial resilience and executive compensation – highlighting governance as fundamental to long-term financial value.
2. Engagements are relationship-based, not based on a directive. BlackRock engages to better understand how corporate leaders manage risks and opportunities. However, it does not direct corporate strategy or its implementation.
3. Eleven percent of shareholder proposals were supported overall. In 2024, BlackRock supported management in ~88% of proposals and notably increased support for governance-focused shareholder proposals. In other words, BlackRock supported ~11% of shareholder proposals.
Breaking this down further, BlackRock supported:
- 20% of governance-related shareholder proposals (73 of 357).
- 4% of social (company impacts on people) proposals (15 of 327).
- 4% of environmental (climate and natural capital) proposals (6 of 173).
4. Environmental and social proposals lag in support. Most E&S shareholder proposals in 2024 were deemed too prescriptive or redundant, and thus received low support. Only ~4% were supported, reflecting a preference for proposals with clear financial materiality.
5. Clients seeking more voting control. BlackRock expanded its Voting Choice program in 2024, including a new climate stewardship option and a pilot in its largest ETF, signaling growing investor interest in personalized voting power.
6. Independent stewardship structures now in place. The creation of BlackRock Active Investment Stewardship (BAIS) reflects a strategic move to separate stewardship for active and index equity holdings while maintaining a focus on client interests.
Authored by
Broc Romanek