BlackRock Exceptionalism in the Geopolitics of Proxy Voting

This paper examines how U.S. mutual funds navigate the intersection of corporate governance and geopolitics by analyzing proxy voting on Chinese corporate charter amendments that formalize Chinese Communist Party (CCP) committees. Using 24,556 fund-level voting records from 2018 to 2022, the study documents a pronounced divergence among the Big Three asset managers. While Vanguard and State Street largely follow proxy advisor recommendations to oppose the institutionalization of CCP committees, BlackRock supports these amendments in 74.70 percent of cases and is more likely to support state-owned, cross-listed, more profitable, and lower-leveraged firms. This "BlackRock exceptionalism" is not explained by firm valuation; instead, the pattern is consistent with using proxy voting as a strategic tool to enhance prospects for regulatory approval and, ultimately, to obtain the first wholly foreign-owned mutual fund license in China. These findings highlight underexplored incentive misalignments among asset managers' commercial interests, fiduciary obligations, and broader U.S. policy objectives.