BlackRock has announced that large pension schemes and other institutional investors invested in certain index strategies will be able to participate directly in proxy voting at its annual general meetings (AGM) from 2022.

In a letter to clients, BlackRock stated that this will apply to around 40 per cent of the $4.8trn index equity assets it manages for US and UK clients.

Currently, most institutional investors use their asset managers to cast proxy votes.

BlackRock said it wanted to provide choice to clients that sought to have a say in how their index holdings are voted.

It also expressed its commitment to extend proxy voting choice to further investors, including those invested in ETFs, index mutual funds and other products.

“This initiative will require the cooperation of additional partners across the investment and proxy voting ecosystem,” BlackRock noted.

“In certain instances, it will also require regulatory and operational system change.”

Commenting on the announcement, Association of Member Nominated Trustees co-chair, Janice Turner, said: "This is a major milestone in stewardship for institutional investors.

“AMNT has been campaigning for nearly a decade for pension schemes investing in pooled funds to be able to have a voting policy that is respected by their fund managers. Today's announcement is a game changer, and we congratulate Blackrock on making that move.

"Now that BlackRock, and DWS which launched a fund with AMX earlier this year, have shown that this is possible we call on the rest of the fund management industry to follow their lead.

"AMNT believes that climate change, and the tough new stewardship regulations connected with it, means it has never been more important that pension schemes have the power to have their voting policies respected. We await the details, but well done BlackRock."

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