While fund manager fees and performance are widely covered, “relatively little attention has been given to their role in corporate governance,” says an article in The New York Times that argues, “C.E.O.s have performed an artful head fake with their high-sounding promises.”

The article shares some interesting findings on the subject from a Morningstar study that analyzed proxy votes cast by large mutual fund companies in 2019. The study found, for example, Vanguard and BlackRock—the two biggest fund managers— “tended to side with management and vote against shareholder-sponsored resolutions more frequently than other big fund companies.” In fact, Morningstar found that BlackRock had the “worst voting record of the major index companies”–a surprise given CEO Larry Fink’s push for other CEOs to “lead their companies toward ‘social responsibility’ and greater ‘purpose.”

Vanguard wasn’t far behind, the article said, reporting that it “consistently lagged other fund complexes on important issues. “

Fidelity, State Street, Parnassus, Boston Trust and Walden were at the top of the voting rankings, the article reports, “followed by fund complexes with strong European roots, like Allianz, Pimco, DWS and Invesco.”

The article states, “It may seem that I am picking on the index fund companies. But they have achieved a rare importance,” adding that by 2018, Vanguard, BlackRock and State Street were the biggest shareholders in 90 percent of the S&P 500 companies, collectively holding more than 20 percent of the voting shares.

“While shareholders are the ultimate owners of corporate America,” the article concludes, “the fund companies obtain immense revenue—and are trying to get even more—from the corporate managers that they need to be monitoring and, when needed, criticizing.”