Blackrock vs Norway Fund at Shareholder Meetings: Institutional Investors’ Votes on Corporate Externalities

35 Pages Posted: 19 Mar 2018

See all articles by Marie Briere

Marie Briere

Amundi Asset Management; Paris Dauphine University; Université Libre de Bruxelles

Sebastien Pouget

Toulouse School of Economics

Loredana Ureche

University of Picardy Jules Verne - CRIISEA

Date Written: March 13, 2018

Abstract

Do institutional investors engage with companies on corporate externalities such as greenhouse gas emissions? And if so, why? We study voting at shareholder meetings by two emblematic global investors: BlackRock, a major asset manager, and the Norway Fund, a responsible sovereign wealth fund. Our data cover 2014 and include the two institutions’ votes on 35,382 resolutions at 2,796 corporations across the world. Both of these so-called universal owners oppose management significantly more often on externality than on financial issues. The Norway Fund is more active on shareholder resolutions concerning externalities related to environmental and social issues rather than governance issues. The difference between the two investors’ voting behavior is larger when we focus on resolutions related to greenhouse gas emissions, a clearly identified externality. Overall, universal ownership (see, e.g., Monks and Minow, 1995) and, more importantly, delegated philanthropy (see, e.g., Benabou and Tirole, 2010) both appear to provide incentives for institutional investors to combat negative externalities generated by firms.

Keywords: Institutional Investors, Voting, Corporate Externalities, Social Responsibility, Universal Ownership, Delegated Philantropy

JEL Classification: G23, G32, G34

Suggested Citation

Briere, Marie and Pouget, Sebastien and Ureche, Loredana, Blackrock vs Norway Fund at Shareholder Meetings: Institutional Investors’ Votes on Corporate Externalities (March 13, 2018). Available at SSRN: https://ssrn.com/abstract=3140043 or http://dx.doi.org/10.2139/ssrn.3140043

Marie Briere (Contact Author)

Amundi Asset Management ( email )

90 Boulevard Pasteur
Paris, 75015
France

Paris Dauphine University ( email )

place du Maréchal de Lattre de Tassigny
Paris, 75016
France

Université Libre de Bruxelles ( email )

Brussels
Belgium

Sebastien Pouget

Toulouse School of Economics ( email )

21 allée de Brienne
31015 Toulouse Cedex 6
France

Loredana Ureche

University of Picardy Jules Verne - CRIISEA ( email )

Pôle Universitaire Cathédrale
10 placette Lafleur BP 2716
Amiens, 80027
France

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