Top US managers ‘dampen’ market support for shareholder resolutions

On average, US managers have further scaled back their backing of environmental and social shareholder resolutions, highlighting an increasingly challenging environment for shareholder activism amid growing political backlash.

In 2025, average manager support for environmental and social resolutions fell to 11.6%, down from 18.8%. The largest US managers are increasingly likely to vote with management and against shareholder resolutions, according to Morningstar’s latest US Proxy Trends Review.

At the same time, US manager support for key shareholder issues such as executive pay — often a lightning rod for broader political scrutiny — has risen over the past two years. US managers now approve more than 90% of all executive compensation proposals.

Support for environmental and social resolutions filed by activist shareholders has dropped most sharply among the three largest US managers — BlackRock, Vanguard, and State Street — Morningstar’s analysis found.

Last year, Vanguard, which ranked lowest in support for shareholder resolutions, backed just 5.5% of all shareholder proposals. BlackRock supported 6.6%, while State Street backed 10.5%. These figures are well below those of smaller US or European managers, which generally show higher levels of support. Morningstar found that the eight largest European managers supported nearly half of all shareholder resolutions.

The findings come amid growing criticism of the proxy voting industry, with the US administration accusing proxy advisory firms of “politicising” shareholder votes. In December, US President Donald Trump issued an executive order aimed at curbing the influence of proxy advisory firms, accusing them of using their power to advance what he described as “radical politically motivated agendas” on climate and social issues.

Commenting on the report, Lindsey Stewart, director of institutional investor content at Morningstar, said they point to greater independence among asset managers: “While it's often believed that proxy advisers have a major influence on voting, our study reveals that managers are actually making independent decisions, as evidenced by the growing support for management resolutions.”

Trump’s executive order, titled Protecting American Investors from Foreign-Owned and Politically-Motivated Proxy Advisors, suggests that US retail investors may inadvertently support climate and social resolutions because they are invested with large managers that rely on proxy voting guidance from the two dominant advisory firms, ISS and Glass Lewis.

However, Morningstar’s research suggests asset managers are making more autonomous decisions, Stewart stressed.

Rather than reinforcing climate resolutions, the influence of the largest managers often weakens overall support for shareholder initiatives. “Some critics have also claimed that preventing the Big Three — BlackRock, State Street, and Vanguard — from voting would lead to less activism at shareholder meetings. However, our research indicates that these firms are supportive of management more often than the broader market, and if they were removed from voting, that would actually increase the probability of a successful activist campaign.”