[fpiacenza]

This is a very naïve view of Asset management companies work.

They have tremendous influence:

1- Blackrock has 170 ETFs with 8.5 Trillion USD.

2- When you buy a ETF, you own the ETF, BlackRock owns the underlying Shares.

3- They exercise voting rights, through their BlackRock Investment Stewardship, based on their own internal policies.

4- They provide limited proxy voting to eligible institutional investors, which is a tiny percentage of their actual clients, representing 12% of their holdings. The rest is completely under their control.

5- They define the ETFs, which means they get to choose how to invest, their clients get to choose which ETF to buy.

6- ETFs are usually defined very loosely, with a lot of maneuvering. Even "iShares S&P" definition is "seeks to replicate the performance of S&P 500". This means they don't have to replicate the holdings, just "try" to mirror performance. In practice this means that the top 10 holdings across all different S&P ETFs are similar, but the long tail has a lot of maneuvering and differences. As long as they provide a similar* performance.

7- They are the pushers of ESG, which means there specific ETFs whose portfolio is driven by ESG scores, and their voting decisions across all the assets they hold across all ETFs are shaped by ESG policies.

8- ESG scores is how they "launder" their influence, and they actively campaign and try to shape public discourse around this. They claim to be doing ESG, but in practice they do what they want. A clear example:

https://www.investmentofficer.lu/sites/default/files/2022-12...