Our approach
Vanguard’s Investment Stewardship team promotes corporate governance practices associated with long-term investment returns at the portfolio companies in which the Vanguard-advised funds invest. We engage in dialogue with portfolio company executives and directors to share our perspectives and principled approach and to learn about companies’ corporate governance practices. On behalf of the funds, we vote in accordance with the funds’ proxy voting policies, with an unwavering focus on the long-term interests of Vanguard-advised-fund investors.
Our four pillars
Our approach to investment stewardship is based around four pillars, focusing on long-term investment returns for Vanguard-advised funds.
Board composition and effectiveness
Good governance begins with a company’s board of directors.
Our primary focus is ensuring individuals who serve as board members are independent, capable, and appropriately experienced.
Oversight of strategy and risk
Boards should work to prevent risks from becoming governance failures.
When we discuss strategy and risk with portfolio companies, we do so to understand how the board of directors oversees the strategy and identifies and governs material risks to long-term shareholder value.
Executive pay
Sound, performance-linked compensation programs drive long-term returns.
We look for companies to provide clear disclosure about their remuneration practices, the board's oversight of those practices, and how they are aligned with long-term investment returns.
Shareholder rights
Shareholders should be empowered.
We believe that a well-functioning capital markets system requires that companies have in place governance structures that safeguard and support foundational rights for shareholders.
“Vanguard’s Investment Stewardship team has a clear, consistent, and compelling mandate to safeguard and enable long-term investment returns at the companies in which Vanguard-advised funds invest.”
Global Head of Investment Stewardship
Engagement practices
Direct company engagement is the foundation of Vanguard’s Investment Stewardship program. Our ongoing dialogues with portfolio company executives and directors enable us to share our perspectives and understand companies’ corporate governance practices and long-term strategy. Our approach is deliberate and constructive.
Engagements at a glance
Engagement is foundational to our Investment Stewardship program, as illustrated in the data below.
1,334 Companies
Companies engaged as of December 31, 2023
31 Markets
Markets represented in our engagements as of December 31, 2023*
$3.9T
Equity assets under management engaged in the last year**
* Countries and territories of risk.
** This dollar figure represents the market value of Vanguard fund equity investments in companies with which we engaged over the 12 months ended December 31, 2023. AUM is calculated as of that date.
Proxy voting
Our team votes proxies at public company shareholder meetings on behalf of each Vanguard-advised fund. Because of our engagement efforts, as well as our published perspectives and policies, by the time our funds’ votes are cast, companies should be aware of the four pillars of corporate governance we associate with long-term investment returns.