[Alberta's Child]

That's true, but the downside of that "proxy" arrangement you describe is that the fund managers have a fiduciary duty to their shareholders. Even in today's outlandish cultural landscape that is still based on MONEY. And anything that undermines a shareholder's financial position becomes a potential point of legal exposure. And that exposure is to each and every shareholder, not just the big ones.

Enter ESG scores assigned companies. If you have any question on that impact, look at what’s happened to Tesla since Elon Musk decided to make an offer for Twitter and, especially, since he decided to announce that he was voting Republican.

ESG scores are a whole different case because they are entirely subjective.

The Musk-Twitter fiasco is a great example of how the fiduciary responsibilities of corporate management work the other way. Over the last couple of months, I've noted that every major development in Musk's favor was immediately preceded by a threat from a Republican governor (usually DeSantis in Florida or Abbott in Texas) to sue Twitter's leadership over a breach of their fiduciary duties. When the leadership was making decisions that would result in financial harm to the shareholders, they had no choice but to reverse course in the face of these lawsuits and do the right thing (and by "the right thing" I mean: the thing that makes the most sense for Twitter's shareholders, not its leadership).

[markomalley]

I agree with what you’re saying, but people who invest in funds look at the overall performance of the fund. Not at the performance of individual equities within that fund.