Once a year, a small group of executives who control trillions of dollars in American companies meet for lunch in Manhattan. Among the things they discuss: pushing for greater say in how companies are run.
It is an elite gathering, but you will not see a single man in a suit in the room. The event, called the Women in Governance lunch, underscores a rare corner in finance where women dominate.
Women hold the top positions in corporate governance at many of the biggest mutual funds and pension funds — deciding which way to vote on the directors of a company board. They make decisions on behalf of teachers, government workers, doctors and most people in the United States who have a 401(k). The corporate governance heads at seven of the 10 largest institutional investors in stocks are now women, according to data compiled by The New York Times. Those investors oversee $14 trillion in assets.
Corporate governance is playing a growing role within the broader ecosystem of corporate America. Each spring, publicly traded companies hold shareholder meetings and outline business strategy for the coming year. Shareholders like BlackRock, T. Rowe Price and State Street vote on corporate strategy and issues including company board appointments and compensation.
Their votes can go a long way, given the huge stakes these institutions control in United States companies. BlackRock holds a stake greater than 5 percent in 75 of the 100 largest companies, according to data compiled by Jerry Davis, a professor at the University of Michigan Ross School of Business. State Street has more than than 5 percent of 23 of the largest companies, while Capital Group owns more than 5 percent of 20 of the biggest companies.
That power, however, is rarely wielded to confront companies. Most of the time, these huge institutional investors choose to vote with management.
And their approach contrasts sharply with that of brash activist billionaires like William A. Ackman and Daniel S. Loeb, who have made a name for themselves as corporate agitators. These investors bring about change by theatrically pounding on the front doors of companies and using the public court of opinion to bully companies into changing their strategies.
Still, the heads of corporate governance at institutional giants say they are working quietly behind the scenes to advocate for greater shareholder rights.
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