Our new paper Shareholder Value(S): Index Fund ESG Activism and The New Millennial Corporate Governance forthcoming in the Southern California Law Review documents and explains the increasing role of large index fund managers in promoting ESG issues at major companies. While often viewed as quiet on key corporate governance issues, we show that these asset managers aggressively press companies to address ESG concerns, especially board diversity and—more recently—climate change. Notably, we show that to promote ESG goals the big three challenged management by withholding votes from directors in uncontested elections, a channel of index fund activism that has not been examined in the existing literature.
Michal Barzuza, Quinn Curtis & David H Webber, Shareholder Value(s): Index Fund ESG Activism and the New Millennial Corporate Governance, Harvard Law School Forum on Corporate Governance (2020).