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The entire corporate governance ecosystem including issuers, investors, advisors, technology companies and academics battled New York City Presidential gridlock to gather at Nasdaq MarketSite on Friday, September 12th for the first-ever conference devoted to so-called “pass through” voting. Sponsored by Vanguard, NYU’s Institute for Corporate Governance & Finance, and Nasdaq and put together by Gladstone Place Partners, the conference gathered leaders in the field to discuss the growth of pass-through voting and its potential implications on governance, shareholder communications and getting out the vote.
Around 80 participants from across the corporate governance world ecosystem convened in what one advisor called a “powerhouse gathering” to discuss the subject of “democratizing” proxy voting by allowing end investors to make proxy choices. You can find a full agenda for the event here.
While the full effects of pass-through voting on topics like contested votes and activism are yet to be seen, pass through voting programs are already of a significant size at each of the big three asset managers (see Vanguard, Blackrock and State Street data). Each season they are growing in eligible assets and client engagement, and they are being refined and improved.
The main takeaway from the conference was clear: pass-through voting is here to stay. Participants in corporate governance need to understand these programs – which are all slightly different, with different positioning and mechanics – and factor them into their ongoing planning, engagement and campaigns.
On the sidelines of the conference, GPP did an exclusive interview with John Galloway, Vanguard’s Global Head of Investment Stewardship, on the topic. Vanguard’s Investor Choice program now reaches nearly 10 million individual investors and comprises $1 trillion of eligible AUM (see latest data here).
Here is what John told us:
Why is Vanguard building out a pass-through “Investor Choice” voting program?
Vanguard launched the Investor Choice program to provide individual investors in our equity index funds the ability to have their voices heard regarding corporate governance matters through proxy voting. Investor Choice is an extension of Vanguard’s long-standing commitment to democratizing investing and meeting investor’s needs. Our approach is grounded in three foundational beliefs. The first is the commonsense view that investors should have the option to have a say in how their index fund holdings are voted, commensurate with their economic investment, should they wish to do so. The second is the fact that different investors have different perspectives and views on what corporate governance outcomes are most likely to help support their investment objectives. And the third is the confidence that giving individual investors access to a range of independent perspectives on corporate governance issues supports a healthy corporate governance ecosystem.
What has been the feedback from stakeholders so far?
The feedback has been very encouraging. Investor participation in the Investor Choice pilot has more than doubled year-over-year, and recent surveys of a broad universe of individual investors indicates widespread interest in participation in this type of program over time. In 2025, we saw investors really demonstrate the “choice” aspect of the program in the form of policy selections, with no single policy option being selected by more than 35% of participants. We see this distribution of policy selections as strong validation that we are providing investors with a menu of distinct choices that speak to different perspectives on proxy voting.
How will Vanguard’s Stewardship function work in conjunction with Investor Choice?
The Board of each Vanguard fund approves a proxy voting policy that is implemented by Vanguard’s Investment Stewardship team. That policy is one of the options that participants in the Investor Choice program can choose from and is the policy that the Investment Stewardship team follows when proxy voting for the pro-rata holdings of investors who do not choose to participate in Investor Choice.
The design of the menu of voting options provided to investors has been the subject of debate and interest – how has Vanguard approached it?
The Investor Choice menu of option provides a limited set of differentiated policy options that reflect a range of viewpoints on what approaches to corporate governance are most likely to support shareholder value creation.
The menu is constructed to foster broad investor engagement, encourage participation, and support informed decision-making related to different approaches to maximizing shareholder value through corporate governance. The design of the menu also reflects the diverse nature of Vanguard’s investor base—individuals who invest directly or through financial advisors, retirement plans, and/or education savings programs. Based on Vanguard’s decades of work with individual investors and our observations of behavioral economics, we know it is important to avoid overwhelming individuals with too many, or insufficiently differentiated, options to choose from.
As Investor Choice continues to grow – and the technologies and policy options available for facilitating individual investor participation in proxy voting continue to evolve – we will refine the menu of policy choices to continue to meet investor needs and interests.
What is next for Investor Choice – what should our readers expect?
There are a few things to expect. Most notably, the program will continue to expand to more Vanguard funds – stay tuned for an upcoming announcement of our next expansion of Investor Choice. At the same time, we will continue to provide investors, portfolio companies, and other interested parties with information about the program and the policy choices investors are selecting, and we will continue to invite feedback and suggestions on how we might evolve the program to best serve investors and support good corporate governance outcomes.
Have a great weekend,
GPP Team
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