An increasing number of schemes are becoming more assertive about stewardship and looking for increased customisation, Tumelo says.
The voting technology firm said that scheme investors in pooled funds – including some of the largest pension schemes in the UK – had "for too long" faced a structural barrier, having no real say in how their votes are cast at the companies they own.
Tumelo said an increasing number of investors – including many in the Local Government Pension Scheme (LGPS) community – were now using pass-through voting to implement their own voting policy or override individual voting proposals.
Tumelo co-founder Will Goodwin said: "Pass-through voting allows asset owners to apply their own votes — even when invested through pooled index funds.
"Instead of relying solely on an asset manager's voting policy, schemes can implement their own and ensure their investment strategy is best reflected on issues like climate, executive pay, and governance reform. It's a structural innovation that brings accountability and alignment to the heart of investment stewardship."
Tumelo said few markets have embraced this transformation as quickly or effectively as the UK LGPS – noting that several large funds had already adopted pass-through voting, working with asset managers and technology providers to make it operationally seamless.
It said LGPS pools such as LGPS Central as well as individual funds including the London Borough of Camden Pension Fund, Greater Manchester Pension Fund and the Northern Ireland Local Government Officers' Superannuation Committee (NILGOSC) had already taken steps towards pass-through voting adoption.
Goodwin added: "The adoption of pass-through voting by the LGPS community signals the start of a global trend. Asset owners are no longer content to be passive participants. They want visibility, voice and verification."
