Capitalmind with Deepak & Shray Who Is Really Controlling Your Money? (Not Who You Think)
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Dec 18, 2025 Deepak Shenoy, founder of Capitalmind and investment expert, dives into the unseen forces shaping your investments. He exposes how proxy advisors like Glass Lewis and ISS exert influence over fund managers, even challenging big names like Elon Musk. Deepak discusses the subjective nature of index manufacturers, revealing their role in corporate mergers and demergers. He highlights the staggering ₹21 lakh crore stagnant in corporate accounts and offers insights on the pitfalls of passive investing, stressing the need for greater transparency in financial practices.
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Proxy Advisors Have Outsized Influence
- Proxy advisors like Glass Lewis and ISS influence institutional votes and often become treated as gospel by fund managers.
- Their standardized rules can be context-insensitive and drive voting behavior across large passive holdings.
Passive Funds Still Must Vote Their Shares
- Passive fund managers cannot outsource voting responsibility even if they outsource investment decisions to indices.
- That creates a governance gap where proxy advisors often fill the vacuum unless funds exercise independent judgment.
Indices Aren't Purely Objective
- Index manufacturers (NSE, BSE) exercise subjective judgment when constructing indices despite claiming rule-based objectivity.
- That discretion matters because huge passive flows force funds to follow their decisions regardless of transparency.