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Bailey McCann, Opalesque New York:

The investment industry should substantially step up its game when it comes to stewardship, according to a new research paper by Willis Towers Watson.

The paper looks at six large asset managers who collectively manage assets in excess of US $17 trillion: BlackRock, Legal & General Investment Management (LGIM), Northern Trust Asset Management, State Street Global Advisors (SSGA), UBS Asset Management (UBS) and Vanguard. The paper looked at these six firms because of their size and the dominance of index tracking firms as significant shareholders within companies.

According to the consultant, all of the managers acknowledge their stewardship responsibility and are taking positive actions. For example, BlackRock Chairman Larry Fink is known for communicating 'from the top' through his public annual letters to company CEOs. Meanwhile, SSGA has helped to raise awareness around gender diversity on boards through its Fearless Girl campaign. However, more can be done.

Willis Towers Watson says that stewardship still counts for only a small fraction of asset management activities and resourcing is uneven. Stewardship programs often lack specificity or come with specific goals. Creating measurable milestones to be completed with a sense of urgency would improve the investor stewardship picture.

The paper also calls out voting. Voting rights are sometimes underutilized and at times there appears to be reticence about voting differen......................

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