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Vanguard Releases Third-Annual Investment Stewardship Report

FYI: Vanguard today released its global 2019 Investment Stewardship Annual Report, which details company engagements and voting records of its mutual funds for the 12 months ended June 30, 2019.

In the report, Vanguard calls for greater diversity among boards of directors at public companies. Vanguard believes that diverse boards make better decisions, which can lead to better results over the long term. Vanguard is asking boards of directors to publish their views on board diversity, disclose their board diversity measures, broaden their search for director candidates, and report progress against those outcomes. The report also addresses sustainability’s role in long-term investing and the importance of standardized risk disclosure frameworks.


  • Lots of interesting nuggets in here. I'm impressed that the puny operating expenses I pay buy all of this effort and attention. PG&E and Bayer, among others, get called out for board-level inadequacies.
  • Not to mention Sinopec and PetroChina.

    But Vanguard is hardly in the, well vanguard, of fund families holding companies accountable. It still seems to prefer working in the shadows to letting some sunshine in. For example:
    We did not, however, support a shareholder proposal that called for greater disclosure on pesticide use. Environmental topics like this one are important to us, but we thought the proposal was unwarranted given that the company already had appropriate procedures to monitor use.
    Also, Vanguard has devolved responsibility for a portion (9%) of its proxy voting to its funds' outside advisors.
  • @MSF I actually think it's a good thing Vanguard is outsourcing some proxy voting, given its lackluster record. I think for instance Wellington Management could do a better job on the ESG front as it has more experience in this area.
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