Vanguard, one of the biggest investment management firms in the world, has announced that it has expanded its Investor Choice proxy voting program, which is intended to enable investors to vote on policies that represent their personal preferences. Launched as a pilot last year in early 2023, this program will reach nearly four million investors with almost $250 billion under management by 2025. The company continues to integrate with Vanguard’s commitment to shareholder participation and various policy options geared toward investor priorities.
The Investor Choice program initially provided the participant with a choice from a selection of voting policies aligned with specific investment objectives and values. To date, the program covers five equity index funds with $100 billion-plus in assets as of 2024. The “Company Board-Aligned Policy” aligns with recommendations from the board of directors of portfolio companies; “Third Party ESG Policy” is guided by thematic ESG voting policy from proxy advisor Glass Lewis, focusing on transparency and risk mitigation in relation to ESG issues; “Vanguard-Advised Funds Policy” is managed by Vanguard’s investment stewardship team; and “Not Voting Policy,” which abstains from proxy voting.
Vanguard has added for the 2025 proxy season a new voting option: the “Third Party Wealth-Focused Policy.” Administered by the proxy advisory firm Egan-Jones, this policy focuses on maximizing shareholder value free of political or social agendas and appeals to investors who expect financial returns only.
In another improvement, Vanguard will replace its “Not Voting Policy” with a “Mirror Voting Policy.” They will vote just like the other shareholders exactly under this policy. Therefore, it is possible for the interests of the investors to be represented even in cases where the investors do not actively make a choice to pick a voting stance.
The expansion of the program into three additional funds in 2025 reflects Vanguard’s ambition to broaden investor engagement. This is an important increase in accessibility and impact relative to what was launched in 2024. Last year, Vanguard said more than 24% of participating investors chose the Third Party ESG Policy, reasserting significant interest in ESG-focused decision making.
John Galloway, Vanguard’s Global Head of Investment Stewardship underlined the firm’s commitment to empowering investors, saying, “Under our mission and legacy of standing up for investors, we’re committed to continuing to expand Investor Choice in a thoughtful, straightforward, and efficient way so that more and more investors can make their voices heard.
Vanguard is trying to introduce diverse policy options toward creating a vehicle for investors toward greater self-determination and proxy votes aligned to one’s values and financial goals. There are almost $250 billion in assets under the umbrella of the revised program that will play an important role in furthering dynamics of corporate governance and investment stewardship in the years to come.