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Passive funds can be good shareholders if they want

Active investing optimists have been pinning their hopes on the pressure for managers to engage with companies on ESG issues. They shouldn’t hold their breath

Passive funds can be good shareholders if they want
Photo: Getty Images

Are we approaching “peak passive”? Beleaguered active managers have been asking the question for years as they watch index funds grab an ever-growing slice of the cake.

Some imagine that 2020 might finally signal a turning point, as active managers benefit from a return of asset volatility and investors demand more engagement with companies, particularly on climate change. But active managers shouldn’t hold their breath.

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