By Edd Micklem, Head of Strategic Partnerships, Tumelo.
At the Council of Institutional Investors (CII) Fall Conference in San Francisco this week, I had the privilege of moderating a panel with Tumelo, SEI Investments and the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) on Voting Choice for Taft-Hartley funds.
Taft-Hartley funds — jointly governed by labour and management — have been pioneers in shareholder democracy ever since the Department of Labor clarified in the 1980s that proxy votes must be treated as plan assets. Brandon Rees, representing the AFL-CIO, reminded us why that matters today:
“Proxy voting is not just oversight. It’s a source of value creation. If we can improve governance and operational performance through the ballot, that’s adding value directly for our members.”
What struck me most was how emphatic the panel was about the delivery of voting choice. Trustees cannot afford to see their stewardship priorities diluted in commingled funds. As Brandon put it:
"If you don’t have a client-directed option to your commingled plans, you’re going to lose those clients.”
He also shared a powerful anecdote:
“We’ve had situations where a Taft-Hartley plan filed a shareholder proposal, and their own asset manager voted against it. As you can imagine, that doesn’t go over well. That’s why choice matters.”
Jana Holt, SEI’s Director of Stewardship, shared how SEI has responded with Vote Choice — a programme that allows participating funds to apply a consistent voting policy across their portfolios.
“Our clients don’t always want to get into the weeds of every single proxy. But they do want to select a policy that reflects their priorities — and Vote Choice makes that possible at scale.”
She also explained the benefits of SEI’s manager-of-managers structure:
“With Vote Choice, we can give [clients] the ability to adopt a single voting policy across the entire equity portfolio from day one — rather than waiting for each individual underlying manager to bring a solution like this to market. That’s especially important when you consider the many boutique managers our clients are invested with. It’s likely to be a long time before pass-through or voting choice solutions reach all the way into that part of the market.”
My colleague Will Goodwin, Tumelo’s co-founder, explained how our technology ensures clients’ investment principles are consistent across accounts:
“Without voting choice, a client’s segregated account might vote one way, while their commingled fund votes the opposite way. In effect, their own votes cancel each other out. Voting choice fixes that, giving them one consistent voice in the market.”
He also shared some data on uptake:
“We’ve seen a 175% increase in asset owners on the platform and more than 200% growth in ballots cast compared to last year. Demand has taken off.”
As moderator, it felt like the panel was largely unified: Taft-Hartley plans have always been leaders in stewardship, and they are continuing to push for more — more transparency, more accountability, more choice.
Brandon summed it up nicely:
“The goal of proxy voting is not just to rack up high votes. The goal is to improve companies’ performance — through governance, through dialogue, and increasingly through shareholder engagement. That’s what delivers long-term value for our members.”