Extending Proxy Voting Choice to More Investors
We recently announced that we are expanding our proxy voting program to more investors, including those owning certain US ETFs and US mutual funds, giving investors the power to choose a voting policy that directs the proxy votes of shares owned in the index equity funds in which they are invested.
Our Expanded Offering
The program expansion will cover more than 80% of eligible index equity assets by the end of 20231, including all US institutional index equity funds and certain eligible US index equity SPDR ETFs and US mutual funds.
By partnering with a leading financial technology provider, we will give investors in certain US index equity SPDR ETFs and US mutual funds managed by the firm, which primarily hold US securities, the ability to direct the voting of the shares owned by those funds by giving investors in those funds the power to choose a proxy voting policy that applies to the voting of shares held by the funds. Our goal is to include all eligible index equity US SPDR ETFs and mutual funds managed by the firm in the proxy voting program by the end of 2024.
The voting policies investors may choose from to direct the voting of shares held by the funds in which they are invested will be made available through Institutional Shareholder Services (ISS), a recognized independent proxy voting provider.
The voting guideline options are:
ISS Benchmark Policy
Guidelines based on ISS’ Global Voting Principles, which provide for four key tenets on accountability, stewardship, independence, and transparency.
ISS Sustainability Policy
Seeks to promote support for recognized global governing bodies promoting sustainable business practices advocating for stewardship of environment, fair labor practices, non-discrimination, and the protection of human rights.
ISS Socially Responsible Investment Policy
Consistent with the dual objectives of socially responsible shareholders – financial and social, the policy reflects a broad consensus of the SRI community and incorporates the assumption that ESG factors could present material risks to portfolio investments.
ISS Catholic Faith-Based Policy
Guidelines for Catholic and other Christian religious institutions that are consistent with the objectives of socially responsible shareholders as well as the teachings of Catholicism and Christianity as a whole.
ISS Public Fund Policy
Designed to help ensure that public funds fulfil all statutory and common law obligations governing proxy voting, with the intent of maximizing the long term economic benefits of its plan participants, beneficiaries, and citizens of the state in which the fund resides.
ISS Taft-Hartley Policy
Based on the AFL-CIO Proxy Voting Guidelines, which comply with all the fiduciary standards delineated by the US Department of Labor.
ISS Board Aligned Policy (US only)
Recommends votes in support of the management recommendation on all ballot items except in circumstances where there is a material governance failure or non-compliance with widely accepted governance practices.
Our Initiative
In December 2022, we announced the initial expansion of proxy voting choice to 49% of eligible index equity assets in separately managed accounts and certain institutional funds in the US and UK. As announced in May 2023, this new expansion gives investors in 82% of eligible index equity assets managed by the firm the ability by the end of the year to make choices in how shares held in the funds and separately managed accounts they own are voted.
Asset Stewardship
Similar to separately managed accounts, shareholders of institutional funds that are eligible for the program can continue to delegate their votes to our Asset Stewardship team by choosing not to opt into the firm’s proxy voting choice program and having State Street Global Advisors continue to vote the shares held by the funds in which they are invested.
No matter what option our clients choose, we remain committed to maximizing long-term shareholder value. We take proxy voting and the stewardship of the assets we manage on behalf of clients seriously. We will continue to engage with portfolio companies to seek long-term value and mitigate risk to our clients’ portfolios through direction conversations, proxy voting and thought leadership.
More on Asset Stewardship
For questions or any further information on our program, please contact your State Street representative.