Thread in which I try to give some perspective to BlackRock's and State Street's sustainability reports. Firstly, there is a qualitative difference in their approaches: State Street to me is the leader, BlackRock is finally starting to move, and Vanguard is missing in action 1/9
But we wont really know where we stand until we see how each of them vote this proxy season. We have had grand statements before. What is really important is to read between the lines and not to expect too much from the asset management industry 2/9
The industy faces all sorts of valid fiduciary concerns, has issues in not really being able to ascertain their ultimate investors' views, faces big corporate resistance, particularly in the US, and also regulatory threats, look at this from the SEC: sec.gov/news/speech/sp… 3/9
To be clear, the Big Three are starting to integrate ESG issues, that can be proven to be financially relevant "material", do not expect them to take on moral/ethical issues. What is super interesting are the policy letters that are being sent to national policy consultations 4/9
These give a better insight on where these asset managers stand. #CorpGov = reduction of agency issues, is still by far the number one focus. Related issues are executive remuneration and board access as well as shareholder rights to vote on takeovers etc. 5/9
there is a bit of a paradox here. We always talk of ESG. And everyone says they do it. But governance at its heart seeks to overcome agency problems to create shareholder value. E & S also consider stakehodler concerns. G at many investors appears to be crowding out the E&S. 6/9
Take for example this quote from BlackRock from 03/19 sent to the UK's FRC, it makes clear that BLK struggles to put societal & shareholder concerns on equal footing (which most asset managers would, but it shows the limits of current ESG push). Link: blackrock.com/corporate/lite… 7/9 
Similar statements from Vanguard to the FRC in this letter: frc.org.uk/getattachment/… 8/9
the purpose of this thread is not to pour cold water on these initiatives, it's great to see them! But don't expect too much. They have made it clear that they target "value not values" which business ethicists have tought me is a false dichotomy, so there is a long way to go 9/9
(I wrote above that the aim of this thread was to give perspective on their sustainability reports, what I meant was that I wanted to add my thoughts about recent reports about them giving greater weight to sustainability concerns, not about any susty reports issued by them)
