Imagine a world where you had the power to advocate for all that you valued – like better labor conditions, cleaner energy and ethical AI – but you chose not to. This is the reality of most foundations that are heavily invested in public markets but are doing little or nothing to use their shareholder power to advance their missions.
Companies like Walmart, Amazon and Microsoft employ millions of people, manage supply chains that impact our environment and create rules and norms around data privacy and artificial intelligence. Because these companies are public, they are accountable to the shareholders who own them. These shareholders can influence corporate practices related to wages, reproductive and maternal health, data and technology and more, through dialogue with the leadership of these companies.
Shareholders who own enough stock in a company have the right to file proposals that request specific actions on corporate practices, and every shareholder has the right to vote on those proposals through a process known as proxy voting.
But shareholder democracy is under attack, which limits investors’ ability to consider and influence these financially material activities. In 2025, the Trump administration and SEC have systematically dismantled decades of shareholder rights protections, withdrawing key proposal rules and making it easier for companies to exclude investor concerns from proxy statements.
Shareholder resolutions targeting environmental and social issues are down by 40% this proxy season.
Meanwhile, the nation’s largest asset managers are abandoning their environmental and social commitments just when they’re needed most. BlackRock now supports less than 2% of environmental and social shareholder proposals—down from supporting dozens just a few years ago. For the second straight year, Vanguard supported zero such proposals in 2025.
While shareholder rights face unprecedented attack and the biggest money managers retreat – submitting to political pressure and responding to their vocal, anti-ESG clients – most philanthropic foundations sit quietly on the sidelines, watching their $1.5 trillion in collective assets remain largely silent in corporate boardrooms.
Historically, foundations have not typically filed or co-filed shareholder resolutions. Today, far too few have a mission-aligned policy for how they (or their advisors) vote their proxies.
Philanthropy works at cross purposes when it makes grants to frontline communities while leaving its power on the table with some of the world’s largest companies. There is another way.
Foundations positioned to lead
Public pension funds and faith-based institutions strategically use their shareholder power to engage with public companies. Corporations listen because they represent significant, long-term capital with clear values and the expertise to engage effectively.
CalPERS, managing over $550 billion for California’s public employees, voted against ExxonMobil’s entire board in 2024 over the company’s legal attacks on shareholder rights. In 2025, despite public pressure against DEI practices, proposals relating to DEI received as much as 98% shareholder support at Disney, Costco, Visa, Apple, Deere, Boeing, Goldman Sachs, Levi’s, AMEX, Coca-Cola and Berkshire Hathaway, noted ICCR, a coalition of faith- and values-based investors.
These efforts translate into real-world impact, while adhering to a strong fiduciary duty standard: improved worker safety standards, enhanced climate disclosures, stronger human rights protections and more transparent political spending benefit both business and society.
Unlike pension funds navigating political pressures or religious endowments with conservative stances on social issues, foundations are less constrained.
In many ways, because foundations exist precisely to make impact, they have the opportunity to play an outsized role in this moment and in these coalitions.
“Foundations that invest in public companies whose practices run counter to their missions are undermining their own work,” says Ruth Shaber, MD, Founder of Tara Health Foundation. When foundations use their proxy votes and shareholder proposals to drive corporate accountability, they’re simply extending their mission work through a different tool.
Mobilizing foundation wealth
Over the past year and half, I have worked closely with a group of foundations looking to leverage all of their assets for impact. The Shareholder Engagement Project’s inaugural cohort offered a roadmap for foundations ready to operationalize shareholder engagement into their core bodies of work. The cohort was started by a group of foundations with years of experience in engaging with companies, including the Nathan Cummings Foundation, The Educational Foundation of America, Jessie Smith Noyes Foundation and Woodcock Foundation.
Over the course of 10 months, more than 15 philanthropic leaders (trustees, executives, investment staff) applied learnings to:
- Join an investor dialogue with one of the country’s largest employers, to discuss their potential DEI rollbacks
- Direct their investment advisors or OCIOs to express their proxy voting preferences, to ensure the foundation was not voting against its mission
- See if and where the companies the foundation owns shares in overlaps with their grantees’ missions
- Attend Annual General Meetings to understand how a company they own stock in, and has a negative impact on their region, responds to investor concerns
- Develop relationships with experts to determine the best staffing/capacity configuration to sustain this work regularly, similar to impact investing or grantmaking
- Implement internal systems to reduce the friction for approval and decisions around which campaigns and engagements their institution collaborates on
These foundations understand that the stakes could not be higher. If foundations continue to sit on the sidelines while shareholder rights erode and asset managers abandon their fiduciary duties, who will hold corporations accountable for their impact on the communities and causes foundations exist to serve?
The infrastructure exists, the expertise is available, and the need has never been greater. The only question is whether foundations will choose to use all their assets—not just their grants—to drive the change they seek.
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Eric Horvath is the Project Lead for the Shareholder Engagement Project. He serves on the board and investment committee of the New York Foundation and also manages an initiative for pension fund trustees at Harvard’s Center for Labor and a Just Economy.
Guest posts on ImpactAlpha represent the opinions of their authors and do not necessarily reflect the views of ImpactAlpha.
