The dog days of summer mark the end of proxy season, when most American corporations hold their annual meetings and shareholders vote on the election of directors, compensation and other corporate matters.

As more individual and institutional investors have turned from individual stocks to mutual and exchange-traded funds, the responsibility for voting at these annual meetings has been entrusted to fund managers like BlackRock.

Many investors value having their asset managers handle proxy voting. Proxy statements can run more than 100 pages. For a person invested in 500 companies through an ETF or index fund, that could mean more than 1,000 hours of wading through materials to make informed decisions on thousands of proxy votes. Many of our clients trust our record as a fiduciary acting in their long-term financial interests.

Still, we believe in offering clients choices. Our firm has always used technology to give clients easier access to an array of investment options. Two years ago, we announced that we would begin providing choices for clients that want to participate more directly in proxy voting, starting with institutional ones like pension funds.

Today, all American public and corporate pension funds we serve can invest in products that let them vote the shares of the companies they own, easily and efficiently. Clients representing more than $550 billion in assets have enrolled in our Voting Choice program. This is a growing share of the $4.5 trillion of equity assets we manage in index funds. While the majority of our clients have asked us to continue voting proxies on their behalf, others are taking advantage of a growing set of options, including voting themselves. This strong client interest has catalyzed others in our industry to experiment with proxy-voting choices.

Last month, we took another step by announcing a plan for a pilot program that offers choices to individual investors in our largest exchange-traded fund. This plan—subject to approval by the board that governs our ETFs—would let millions of these individual investors select from different policies to decide how their share of the ETF will vote on the companies they own.

There are always critics. There is a myth that BlackRock blindly follows the recommendations of proxy advisory firms like Glass Lewis and Institutional Shareholder Services when voting on behalf of our clients. That myth is debunked if you look at the facts. Over the past 12 months, on shareholder proposals where ISS made a recommendation that was different from a company’s management, BlackRock supported management 85% of the time and agreed with ISS only 15% of the time.

For BlackRock, it’s about financial value, not social or political values. On proxy voting, our clients’ financial interests are paramount. BlackRock makes its decisions independently, informed by company disclosures, engagement with management, and proprietary and third-party research.

With Voting Choice, our clients choose from a menu of third-party voting policies or design their own policies. Since its launch, clients with about 30% of the assets enrolled in our program have chosen to use their own policies rather than those from third parties. Individual investors seldom sit at home writing their own proxy-voting policies, and many institutional investors prefer to choose from the third-party ones.

We now offer 14 different third-party voting policies—double the number offered when Voting Choice launched. These policies can be tailored to Catholic values, for union pension funds, or to policies that support environmental and social proposals. We also offer a governance-aligned policy that, rather than taking a view on environmental and social proposals, follows each corporate management team’s recommendations. Yet, it focuses on commonly accepted principles of corporate governance and doesn’t always support management on governance matters. This governance-aligned policy is the most popular third-party policy among our public pension fund clients in the U.S.

Beyond the 14 policies we offer from the two largest proxy advisory firms, we are working to add policies from other firms. We have long argued that investors benefit from having more proxy advisory firms in the industry to choose from.

As we refine Voting Choice, our ambition is for all investors to have easy and efficient options to participate in proxy voting if they choose. Greater voting choice requires asset owners to invest time and resources in making informed decisions. But giving them a say strengthens shareholder democracy and supports America’s capital markets, which improves people’s lives here and around the world.

Mr. Ramji is BlackRock’s head of iShares and index investing. Ms. Abdel Majeid is BlackRock’s global head of investment stewardship.

Appeared in the August 4, 2023, print edition as 'BlackRock Gives Investors a Say'.