Why Shareholder-Driven Corporate Social Responsibility Failed

April 8, 2026, Opinion: "A decade ago, hopes were high in some circles that pressure from the new, large, economically-powerful institutional shareholders, like BlackRock, for more corporate social responsibility—on issues like climate change, the environment, and justice—would become a major feature of the corporate landscape and move the American corporation to do what government was not doing. That hope arose because incentives emanating from America’s shareholding structure had shifted when firm-by-firm investments by large shareholding institutions evolved to market-wide, across-the-economy investments in very large portfolios. Institutional investors of this sort no longer picked stocks; they invested broadly across the stock market and the American economy. In some circles that ownership structure looked to be creating incentives for financial institutions with wide ownership to pressure the American corporation to benefit the economy overall, and not just boost the profits of their portfolio companies. In CSR circles, hopes were high that the new universal owner had incentives to fulfill social responsibility gaps seen as having been left by government."