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Blackrock canceled meetings with companies in the midst of shareholders’ battles because they are afraid to violate the directive of the investor activity issued by the US Securities and Exchange Committee last week.

Blackrock Other asset managers usually talk to companies about voting before activity campaigns and also about voting problems in the routine agent in annual shareholders ’meetings.

However, this practice has been questioned by the Supreme Education Council guidelines, which were widely interpreted as an attack on use Environment, social and governance (ESG) factors in investment. Change imposes more exhausting organizational requirements on fund managers who may seek to influence corporate behavior.

“These directives exploded like a hand grenade in the middle of the battles of the battles in the agent last week,” said Kay Likvit, a partner in Sidi, who represents companies in the battles of activists who will be honest.

A person familiar with this said that Blackrock, the world’s largest asset manager, temporarily stopped the “supervision” meetings to assess the meaning of changing the SEC base.

Movement for the Supreme Education Council It is part of a greater regulatory effort by government and unionist officials to curb the authority of the largest fund managers, which often reaches 10 percent of most American companies due to the huge size of their funds that follow the index.

Until February 11, the Supreme Education Council said that the fund managers who own more than 5 percent of the company are not considered “affecting” the behavior of companies when they collected companies on issues ranging from executive compensation to environmental policies. As such, they were allowed to present a relatively short model of their holdings, known as 13-G, and it is only for “negative investors”.

Under the new rules, the criteria that would lead to a more cushioning deposit 13-D. Traditionally, 13-D files have been largely booked for active investors such as hedge funds or investment managers looking to influence control.

The guidance complicates the joint practice between the directors of the large funds for the urgent companies to detect climate risk, diversify their paintings and take other steps they say are in the interest of shareholders in the long term.

While some of these issues are closely related to the US Culture Wars, the rules also undermine efforts to eliminate poison pills plans for companies and other issues of routine corporate governance that have nothing to do with environmental and social issues.

Form 13-D requires detailed explanations for the cause and how the investor has gained his share and its purpose for investment. Activist investors also face more compact final dates to make updates to share or sales purchases with SEC.

“This is a change to combat ESG,” said the lawyer, who advises senior managers. “The practical impact of this will make it difficult to engage in ESG topics, and will increase the pressure on managers when they think about how to engage them directly and unofficially.”

Blackrock, who has more than 11 tennis Tuns of management assets, has suffered severe pressure from American legislators conservative on its impact on American companies, given its great property in almost every American company listed.

The change of the Supreme Education Council came amid a set of procedures by the agency to stay away from the Biden administration policies. They were adopted during Paul Atkins, President Donald Trump SEC chair candidateThe Senate is confirmed.

Blackrock and SEC refused to comment. It was not immediately clear whether it was the biggest Blackrock, Vanguard and State Street, also canceled the meetings.

Stephania Balma contributed to the reports from Washington

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