Asset Manager Capitalism as a Corporate Governance Regime

Braun, Benjamin

doi:10.1017/9781009029841.010

Cited by 74 publications

(50 citation statements)

References 528 publications

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“…These products do not seek to select assets that will yield returns greater than the market average, but simply to replicate the composition and financial performance of a benchmark stock index such as the S&P 500. Their popularity has grown rapidly since the 2008 financial crisis due to their capacity to produce average returns comparable to those of actively managed funds at considerably lower costs ( Braun, 2016 , 2021 ), enabling a few index fund providers to accumulate extensive shareholdings in companies spanning entire stock markets ( Jahnke, 2019b ). By 2018, the three largest such firms – US asset managers BlackRock, Vanguard and State Street – held an average combined ownership stake in S&P 500 companies of over 20% ( Fichtner and Heemskerk, 2020 ).…”

Section: Universal Ownership: Politicizing Finance?mentioning

confidence: 99%

“…These organizations’ extensive shareholdings are often considered to grant them considerable influence over publicly traded corporations, enabling their investment decisions (in theory at least) to catalyze and channel global economic and ecological change ( Crona et al, 2021 ; Galaz et al, 2018 ). Political economists therefore increasingly diagnose a new regime of corporate ownership and governance called ‘asset manager capitalism’ ( Braun, 2021 ; Fichtner and Heemskerk, 2020 ), in which ‘ [i]nstitutional investors to a substantial degree establish the (…) conditions of possibility, on which capitalism in general and the capitalist production of nature in particular develops’ ( Christophers, 2019 : 755).…”

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confidence: 99%

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Immaterial animals and financialized forests: Asset manager capitalism, ESG integration and the politics of livestock

et al. 2022

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This article uses interviews with responsible investment professionals to examine the extent to which institutional equity investors, and specifically ‘universal owners’ with highly diversified shareholdings, engage with public issues associated with livestock agriculture. As share ownership becomes increasingly concentrated, and the market for Environmental, Social and Governance investment products grows, these investors are increasingly involved in governing the activities of publicly traded corporations (including leading agribusinesses). This paper brings together political economy and marketization studies research to explore how universal owners become concerned about particular environmental and ethical problems, why they overlook other public concerns, and in what ways their selective engagement with ethico-political issues might be altering the content of food politics. Comparing universal owners’ engagements with farm animal welfare issues and with tropical deforestation within animal feed supply chains, we argue that these institutions engage with tropical deforestation because it presents a financially material risk to firms across multiple industries. By contrast, the specificity of farm animal welfare issues to agribusinesses means that they do not pose a material risk to the overall performance of universal owners’ highly diversified asset portfolios. Efforts to concern universal owners about livestock agriculture's social, environmental and health impacts thus generate a food politics which focuses primarily on risks to global economic systems and renders animals themselves distinctly immaterial.

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Section: Universal Ownership: Politicizing Finance?mentioning

confidence: 99%

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confidence: 99%

Immaterial animals and financialized forests: Asset manager capitalism, ESG integration and the politics of livestock

et al. 2022

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“…The decisional agency of top management is curbed (or at least monitored) by activist, often institutional, shareholders: investment and hedge funds, investment banks or private equity funds. Consequently, the senior managers of these institutional shareholders become important new players—to the detriment of the inhouse corporate elites (Braun, 2021; Folkman et al., 2007; Useem, 1996). Unlike the traditional economic elites, this new group of economic elites is no longer necessarily at the top of large, multi‐divisional and publicly quoted firms (Davis, 2009).…”

Section: Social Congestion and Intensification Of Competitionmentioning

confidence: 99%

Elite recruitment in US finance: How university prestige is used to secure top executive positions

Bühlmann

Schoenberger

Ajdacic

et al. 2022

British Journal of Sociology

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Status attainment theories assert that individuals are recruited based on the length and functional background of their training. Elite theories assume that top managers often deviate from these socially acceptable mechanisms of status attainment to entrench their advantage. In this study, focusing on the US financial sector, we investigate whether educational institution prestige—rather than the subject or length of education—increasingly influences appointments to top executive positions. We analyze 1987 US top executive managers affiliated with 147 firms from both financial and non‐financial sectors in 2005 and 2018. Our study demonstrates that alumni of prestigious universities have a strikingly higher likelihood of attaining a top executive role in finance than in non‐finance. Within finance it is no longer investment banking, but private equity, that contains the highest proportion of elite university graduates. Our findings suggest that notwithstanding the major power shifts between finance and non‐finance—and also within the finance sector—elite groups still dominate the most symbolically valued education, and as a result, top managerial positions.

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“…It also facilitated the emergence of what political scientist Benjamin Braun has called "asset manager capitalism," in which colossal firms like BlackRock sit at the apex of the global economy. 13 Notably, though, even as the total monetary base of the national economy swelled almost five-fold between 2010 and 2014, inflation stubbornly refused to budge, averaging less than the Federal Reserve's conservative 2 percent target over the decade as a whole. This experience suggested that in fact, the danger of recession accompanied by deflation was of greater concern than renewed inflation.…”

Section: If This Monetary Regime Of Low Wages Low Interest Rates and ...mentioning

confidence: 99%

Who Pays for Inflation?

Sonti

2022

New Labor Forum

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Asset Manager Capitalism as a Corporate Governance Regime

Cited by 74 publications

References 528 publications

Immaterial animals and financialized forests: Asset manager capitalism, ESG integration and the politics of livestock

Immaterial animals and financialized forests: Asset manager capitalism, ESG integration and the politics of livestock

Elite recruitment in US finance: How university prestige is used to secure top executive positions

Who Pays for Inflation?

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