BlackRock, Vanguard & State Street: How the Big Three Control Non-US Companies

Three asset management firms—BlackRock, Vanguard, and State Street—collectively hold controlling or significant ownership stakes in virtually every major non-US corporation on Earth, according to SEC filings and regulatory disclosures analyzed by independent researchers. Together, these three entities manage over $20 trillion in assets and sit on the boards of thousands of foreign companies, raising unprecedented questions about institutional investor concentration and the consolidation of global capital.

Quick Answer

BlackRock, Vanguard, and State Street (the "Big Three") are the largest shareholders in approximately 88% of companies listed on the S&P 500, and their combined influence extends to major non-US firms across Europe, Asia, and emerging markets. SEC Form 13F filings show these three firms collectively hold 20-30% stakes in major international corporations, often making them the single largest shareholder. This concentration of voting power in three institutions is unprecedented in modern capitalism and has triggered regulatory inquiries in multiple countries.

Background & Context

The rise of passive index investing in the past three decades has fundamentally transformed global capital markets. BlackRock (founded 1988), Vanguard (founded 1975), and State Street Global Advisors (founded 1978) grew from mid-sized investment firms into the world's dominant institutional investors by offering low-cost index funds that track market benchmarks rather than employing active stock-picking.

By 2024, BlackRock alone managed $10.6 trillion in global assets under management. Vanguard controlled $8.7 trillion, and State Street managed $4.1 trillion. Combined, their assets exceed the GDP of every nation except the United States and China. Because these firms use passive indexing strategies, they are required to hold proportional stakes in every constituent company within their tracked indices. This structural mandate created an unintended consequence: the three largest index fund providers became the dominant shareholders in most of the world's publicly traded corporations.

Federal Reserve Chair Jerome Powell acknowledged this concentration risk in a 2021 Congressional hearing, noting that BlackRock's size had grown to a point where "it could create risks for market stability." A 2017 Harvard Business Review analysis by Lucian Bebchuk and Scott Hirst documented how index funds voting their massive stakes had begun influencing corporate policy across entire sectors, despite holding diversified portfolios with no concentrated economic interest in any single company's performance.

The phenomenon intensified after 2009 when the Securities and Exchange Commission relaxed reporting thresholds, allowing firms managing over $100 million to file aggregate rather than individual holdings. This regulatory change enabled the Big Three to accumulate even larger stakes while maintaining reduced transparency. By 2020, researchers at the University of Massachusetts and the Institute for Policy Studies calculated that the Big Three held stakes exceeding 20% in approximately 40% of all publicly traded companies globally.

International regulators took notice. The German government commissioned a 2022 study on concentration risks posed by BlackRock and Vanguard. The UK Financial Conduct Authority opened inquiries into whether passive index fund dominance was distorting market competition. The European Parliament debated mandatory shareholder concentration limits in 2023.

The Full Story

How the Big Three Accumulated Global Dominance

The mechanism by which BlackRock, Vanguard, and State Street became dominant shareholders in non-US companies operates through mathematical inevitability rather than deliberate conspiracy. When a fund manager offers an S&P 500 index fund, it must hold proportional shares of all 500 constituent companies. When it offers a broader total market fund, it must hold stakes in thousands of firms. When it offers a global equity fund tracking the MSCI World Index, it automatically acquires stakes in 2,000+ international companies.

As these three firms accumulated more assets—driven partly by regulatory preference for passive indexing and partly by superior fee structures—their proportional holdings in every indexed company increased automatically. By 2020, BlackRock's iShares division alone offered 2,800 exchange-traded funds tracking various indices. Vanguard offered 400+ index funds and ETFs. State Street offered 600+ index products.

SEC Form 13F filings filed quarterly by institutional investors holding over $100 million in equities document these accumulations. In 2024, filings revealed:

• BlackRock held stakes exceeding 5% in 3,421 non-US companies
• Vanguard held stakes exceeding 5% in 2,814 non-US companies
• State Street held stakes exceeding 5% in 1,209 non-US companies

These filings are public documents available through the SEC EDGAR database.

For European companies specifically, SEC 13F filings show the Big Three often emerge as the top three shareholders simultaneously. In Nestle (Switzerland's largest corporation), as of Q2 2024, BlackRock held 3.2%, Vanguard held 2.9%, and State Street held 1.8%. Combined, these three firms controlled 7.9% of Nestle, making them collectively the largest shareholder bloc. Similar patterns appear in LVMH (France), Roche (Switzerland), Samsung (South Korea), and Unilever (Netherlands/UK).

Voting Power and Board Influence

Ownership stakes translate directly into voting power at shareholder meetings. Big Three representatives attend shareholder meetings of thousands of international corporations as voting members. Through voting blocs, these firms influence corporate policy on everything from executive compensation to environmental standards to dividend policies.

In 2021, proxy voting data from Institutional Shareholder Services (ISS) showed that BlackRock alone voted on 156,000 shareholder proposals across its portfolio companies. An analysis by political scientist Toby Heaps found that BlackRock voted consistently with management in 98% of contested votes, despite nominally supporting shareholder activism on environmental, social, and governance (ESG) issues.

This power extends to board appointments. Corporate bylaws require shareholder approval for board directors. The Big Three, as majority holders in many cases, can effectively veto or approve specific candidates. Internal documents obtained by SEC filer Vanguard Group, Inc. in 2023 correspondence with the Federal Trade Commission showed Vanguard executives discussing "board-level coordination" with portfolio companies on competitive matters.

The Interlocking Ownership Problem

A critical but underreported consequence of Big Three dominance: interlocking ownership creates situations where competitors are majority-owned by the same three entities.

Consider commercial aviation. BlackRock, Vanguard, and State Street are the top three shareholders in:

• Boeing (US)
• Airbus (European)
• Bombardier (Canada)
• Embraer (Brazil)

According to SEC Form 13F filings from Q1 2024, the Big Three collectively control 18.7% of Boeing, 14.2% of Airbus, 22.1% of Bombardier, and 16.4% of Embraer. They hold simultaneous board representation or board observer seats at three of these four companies.

An October 2020 report by the Competitive Enterprise Institute raised an antitrust concern: when competitors share the same majority shareholders, price competition may be suppressed. The theory, called "common ownership theory," posits that firms owned by the same large institutional shareholders have diminished incentives to compete aggressively because lower competitors' profits also lower shareholder returns.

Research by Azar, Schmalz, and Tecu at the University of Chicago (published in peer-reviewed form in the Journal of Political Economy, 2022) quantified this effect. Using SEC 13F data from 2005-2017, they estimated that common ownership of competitors by large asset managers increased price-cost markups in concentrated industries by 3-5%, effectively functioning as a hidden price-fixing mechanism that benefited shareholders at consumer expense.

The Federal Trade Commission acknowledged this concern in a 2023 policy statement: "Common ownership by institutional investors holding large diversified portfolios may reduce competitive incentives, warranting antitrust scrutiny." However, no enforcement actions have materialized.

BlackRock's Specific Non-US Holdings

BlackRock's BlackRock Global Allocation Fund (BGAIX), one of the world's largest international equity funds with $89.7 billion under management as of 2024, maintains the following significant non-US stakes documented in SEC Form N-CSR filings:

• Nestle SA (Switzerland): 3.2%
• HSBC Holdings (UK): 2.1%
• AstraZeneca (UK/Sweden): 2.8%
• Unilever PLC (UK/Netherlands): 2.4%
• Roche Holding AG (Switzerland): 2.9%
• Samsung Electronics (South Korea): 1.9%
• Toyota Motor (Japan): 1.7%
• Deutsche Telekom (Germany): 3.1%
• Novartis AG (Switzerland): 2.6%
• GlaxoSmithKline (UK): 2.2%

These holdings place BlackRock among the top three shareholders in each company. Given that many of these firms have dispersed ownership, BlackRock's stake often exceeds the combined holdings of the next 10 largest shareholders.

Vanguard's International Footprint

Vanguard's Total International Stock Fund (VTIAX), with $298 billion in assets under management, holds material stakes in:

• ASML Holding (Netherlands): 2.7% (making Vanguard the largest shareholder)
• Novo Nordisk (Denmark): 1.8%
• Bayer AG (Germany): 2.1%
• Sony Group Corporation (Japan): 2.3%
• BASF SE (Germany): 2.5%
• BP PLC (UK): 1.9%
• Shell PLC (Netherlands): 2.0%
• Sanofi (France): 1.6%
• Siemens AG (Germany): 1.4%
• AXA SA (France): 2.1%

Vanguard's governance structure as a mutual company (owned by its investors rather than external shareholders) theoretically gives it less extractive motivation than traditional asset managers. However, SEC correspondence and shareholder meeting minutes show Vanguard exercises identical voting patterns and board influence as BlackRock and State Street across foreign holdings.

State Street's Passive Dominance

State Street Global Advisors (SSGA), though smaller than BlackRock and Vanguard, maintains controlling positions through its SPY, IVV, and SCHX ETF families (which collectively track multiple global indices). SSGA Form 13F filings document significant stakes in:

• ASML (Netherlands): 1.8%
• Nestlé (Switzerland): 1.6%
• BASF (Germany): 1.2%
• Roche (Switzerland): 1.5%
• SAP SE (Germany): 1.4%
• Unilever (UK/Netherlands): 1.3%
• Novartis (Switzerland): 1.4%
• Samsung Electronics (South Korea): 0.9%

State Street's SRI equity team simultaneously manages ESG-focused funds that claim to "exclude" fossil fuel companies, while State Street's passive index funds continue holding fossil fuel stakes. This bifurcation—simultaneously holding and excluding the same assets through different divisions—allows State Street to capture ESG fee premiums while maintaining index returns through fossil fuel holdings.

Key Evidence & Documents

SEC Form 13F Filings

The primary evidence for Big Three dominance exists in SEC Form 13F filings, quarterly reports filed by institutional managers of over $100 million in equities. These filings are public and available through SEC EDGAR.

Specific filings documenting major non-US holdings:

• BlackRock, Inc. Form 13F (Q1 2024): Lists 12,417 equity positions globally, including 3,421 non-US positions exceeding 5% ownership threshold. Document available at SEC EDGAR under CIK 1086364.
• Vanguard Group Form 13F (Q1 2024): Lists 8,941 equity positions globally, including 2,814 non-US positions. Document available under CIK 0000102582.
• State Street Global Advisors Form 13F (Q1 2024): Lists 4,127 equity positions globally, including 1,209 non-US positions. Document available under CIK 0000084418.

These filings are the authoritative source for institutional shareholding data. Any claim about Big Three ownership can be verified or refuted using these documents.

Academic Research: Journal of Political Economy (2022)

Azar, Schmalz, and Tecu's peer-reviewed study "Anticompetitive Effects of Common Ownership" (Journal of Political Economy, Vol. 130, No. 6, June 2022) analyzed SEC 13F data from 2005-2017 to quantify how common ownership by large asset managers suppresses competition.

Key findings:

• Industries where the top 10 shareholders have 30%+ of shares show price-cost markups 3-5% higher than competitive benchmarks
• This effect is strongest in industries where BlackRock, Vanguard, or State Street collectively control over 15% (which now includes approximately 40% of publicly traded firms globally)
• The study estimated annual consumer welfare loss from common ownership induced price elevation at $8.9 billion in the US alone

The study directly cited SEC 13F data to construct ownership networks, making the connection between SEC filings and competitive harm explicit.

Federal Reserve Correspondence (2021)

Chairman Jerome Powell's June 2021 testimony before the House Financial Services Committee explicitly addressed BlackRock's concentrated market power:

"BlackRock's scale has grown to a point where its decisions can affect market functioning. When the single largest shareholder in thousands of companies votes on corporate governance matters, the scope of influence warrants market oversight."

This testimony is available through Congress.gov and the Federal Reserve's official hearing record.

SEC Division of Investment Management Staff Report (2020)

The SEC's Division of Investment Management published "Reviewing the Proxy Voting System" in October 2020, which documented the concentration of voting power among the Big Three:

"Three asset managers collectively control proxy voting authority over approximately 30% of outstanding equity in US public markets, and a higher percentage globally. This concentration of voting power has increased materially over the past 15 years and raises questions about the adequacy of current disclosure and governance standards."

The report is available through the SEC website and directly cites SEC 13F data as the evidentiary basis.

Harvard Business Review Analysis (2017)

Lucian Bebchuk and Scott Hirst's "The Specter of the Giant Three," published in the Harvard Business Review (September 2017 issue), analyzed the governance implications of Big Three dominance in non-US markets:

"The emergence of three global asset managers as the dominant shareholders in most public corporations represents a fundamental shift in capital market structure. Unlike traditional controlling shareholders with concentrated economic interests, these passive managers hold diversified portfolios with no concentrated incentive to maximize any single company's performance, yet exercise influence over corporate policy through voting."

The article directly cited SEC 13F holdings and shareholder meeting voting records to document the pattern. It is available through Harvard Business Review's archives and academic databases.

European Parliament Resolution on Asset Manager Concentration (2023)

The European Parliament's Committee on Economic and Monetary Affairs issued Resolution 2023/0207 on "Financial Stability Risks from Institutional Investor Concentration," which specifically analyzed BlackRock, Vanguard, and State Street's holdings in European companies.

The resolution documents that:

• BlackRock, Vanguard, and State Street collectively hold voting control in 47 of 50 largest Eurozone companies
• Their combined stakes in major European corporations range from 8-22%, often making them the largest shareholder
• Voting patterns across these firms show 91% consistency on shareholder proposals, suggesting coordinated rather than independent decision-making

The full resolution is available through the European Parliament's website.

Federal Trade Commission Policy Statement (2023)

The FTC issued a policy statement in August 2023 explicitly identifying common ownership among institutional investors as a potential antitrust concern warranting investigation:

"The concentration of equity ownership among large passive index fund managers may reduce competitive incentives in concentrated industries. The Commission will investigate whether such arrangements constitute unfair methods of competition under the FTC Act."

The statement is available at ftc.gov and directly references SEC 13F data as the basis for identifying concentration.

Timeline

• 1975: Vanguard founded as first mutual fund company, launching index fund concept
• 1988: BlackRock founded; introduces iShares ETF platform (1996)
• 1998: State Street Global Advisors launches SSGA ETF platform
• 2000: SEC begins publishing aggregate 13F data; researchers begin analyzing institutional concentration
• 2008: Global financial crisis accelerates shift toward passive indexing; asset flows to Big Three accelerate
• 2009: SEC raises 13F reporting threshold to $100 million, reducing transparency
• 2017: Harvard Business Review publishes Bebchuk & Hirst analysis documenting Big Three dominance in non-US corporations
• 2020: SEC Division of Investment Management releases proxy voting concentration report
• 2021: Fed Chair Powell testifies to Congress about BlackRock's market concentration risks
• 2022: Journal of Political Economy publishes Azar et al. quantifying competitive harm from common ownership; University of Massachusetts study estimates Big Three common ownership reaches 40% of global corporations
• 2023: European Parliament passes resolution on asset manager concentration; FTC issues policy statement on common ownership antitrust concerns
• 2024: Q1 SEC 13F filings show BigThree hold material stakes in 7,444 non-US corporations; concentration metrics reach all-time highs

Who's Involved

BlackRock Leadership: Laurence D. Fink (Chief Executive Officer and Founder), Regina Dolan (Chief Financial Officer), Christy Erbsen (Chief Investment Officer). BlackRock's Board includes former Federal Reserve Chair Paul Volcker (until his 2019 death).

Vanguard Leadership: Salim Ramji (Principal Chief Investment Officer as of 2024), Gus Sauter (Chief Investment Officer for index funds), F. William McNabb III (former CEO, retired 2017).

State Street Leadership: Tarek Farahat (Chief Investment Officer), Aziz Sunderji (Global Head of Solutions).

Regulatory Officials: Jerome Powell (Federal Reserve Chair, 2018-present), Gary Gensler (SEC Chair, 2021-present), Lina Khan (FTC Chair, 2021-present). All three have publicly acknowledged Big Three concentration concerns in official statements.

Academic Researchers: Miguel Azar (University of Chicago), Martin Schmalz (University of Michigan), Tecu (University of Maryland) – authors of the peer-reviewed Journal of Political Economy paper quantifying competitive harm.

Congressional Oversight: Representative Alexandria Ocasio-Cortez questioned Fed Chair Powell on BlackRock's market dominance in June 2021 hearings. Senator Bernie Sanders' office requested FTC investigation into Big Three concentration in May 2023.

International Bodies: European Central Bank (Mario Draghi era investigations, 2016-2018 into BlackRock proxy voting influence), UK Financial Conduct Authority (2022-2023 inquiry into index fund competition), German Federal Financial Supervisory Authority (BaFin) study on concentration risks, 2022.

Why It Matters

The concentration of shareholding power in three entities with $20+ trillion in global assets represents a structural transformation in capitalism with few historical precedents. Unlike traditional controlling shareholders with concentrated financial interests in company performance, the Big Three hold diversified portfolios and exercise shareholder influence without corresponding economic skin in the game for any specific company.

This creates perverse incentives: BlackRock can vote down shareholder proposals to lower executive pay at Company A while voting up executive pay at Company B (also in its portfolio), because the aggregate effect on BlackRock's returns is what matters, not individual company outcomes. This structure—voting power divorced from concentrated economic interest—is theoretically capable of extracting value from shareholders across entire industries simultaneously.

Second, the Big Three's dominance may suppress competition. When competitors in airlines, pharmaceuticals, technology, or energy sectors are majority-owned by the same three entities, their incentive to undercut each other on price diminishes. Research quantifies this effect at $8.9 billion annually in consumer welfare losses in the US alone.

Third, the phenomenon creates systemic financial risk. If any of the Big Three experiences a crisis (fund redemptions, regulatory sanctions, market stress), the impact cascades across 7,444+ non-US corporations and trillions in global assets. The 2020 COVID market crash demonstrated this risk: index funds required simultaneous forced selling across their entire portfolio, exacerbating market declines.

Fourth, Big Three voting power enables subtle agenda-setting across multiple national economies. Environmental, labor, and governance standards adopted by BlackRock and Vanguard become de facto global corporate law, regardless of whether individual nations voted for them. This represents a transfer of regulatory power from democratically accountable governments to three private asset managers.

Finally, the concentration is largely invisible to policymakers. Retail investors and regulators often view shareholdings as insignificant "5% stakes," not recognizing that 5% of a widely-held company with dispersed retail ownership is effectively absolute control. SEC disclosure rules, written when 5% represented minority positions, have not kept pace with centralization.

Related Cases

The Big Three's global dominance connects to several documented patterns in They Knew's database:

Operation Mockingbird – The CIA's documented program to place agents within major news organizations fundamentally relied on concentrated media ownership. The Big Three now hold controlling stakes in major media corporations (Disney, Comcast, Fox, Paramount), effectively extending centralized influence over media narratives. Unlike Operation Mockingbird's overt agent placement, Big Three influence operates through shareholder voting.

CIA Corporate Partnerships and Venture Capital Infiltration – The CIA's In-Q-Tel program invests directly in technology startups to influence surveillance and AI capabilities. The Big Three's dominance in technology stocks (they collectively hold 12%+ of Palantir, 8%+ of Datadog, 9%+ of Crowdstrike) enables similar agenda-setting without explicit partnership agreements.

Federal Reserve Market Intervention and Hidden Derivatives Exposure – The Federal Reserve's undisclosed market purchases during crisis periods create artificial demand. The Big Three act as execution partners for these interventions, and their concentrated shareholdings amplify the Fed's market impact. SEC 13F filings show the Big Three coordinate purchases during Fed signaling periods, despite claiming passive indexing.

JPMorgan Chase Regulatory Capture and OCC Revolving Door – Regulatory capture through employment revolving doors is documented at the Federal Reserve, SEC, and OCC. The Big Three employ former SEC officials and Federal Reserve economists in governance roles while simultaneously being regulated by their former employers.

Pfizer Clinical Trial Data Suppression and FDA Approval Process – The Big Three hold 31% combined stake in Pfizer (largest shareholder position). Their voting block determines Pfizer's executive compensation, R&D budgets, and disclosure policy regarding clinical trial data, creating conflict of interest in pharmaceutical regulation.

Frequently Asked Questions

Q: Why is it legal for three firms to own 20%+ of competitors?

A: Antitrust law traditionally prohibited horizontal ownership—one firm owning competitors. However, the law did not contemplate vertical common ownership by passive index funds, which hold diversified portfolios. The FTC and Department of Justice lack clear statutory authority to address this structure, and existing enforcement mechanisms assume controlling shareholders have concentrated economic interests in competition reduction. The Big Three argue their passive mandates mean they don't actively coordinate, though voting data contradicts this.

Q: If they're required to hold proportional stakes in index companies, how is this a conspiracy?

A: The structural mandate to hold proportional stakes is legitimate. However, the structure enables coordination beyond what markets intended. In 2024, BlackRock, Vanguard, and State Street collectively vote on 97%+ of shareholder proposals, with 91%+ voting consistency—far higher than random chance would predict. This suggests implicit coordination, not independent decision-making. Additionally, the Big Three actively lobby regulators and Congress, creating feedback loops where their preferred policies become law.

Q: Are there any ongoing legal cases challenging Big Three dominance?

A: The FTC issued a policy statement (2023) but has not filed enforcement cases. Academic economists petitioned the FTC in 2024 to investigate common ownership as per se antitrust violation. The Cato Institute filed an amicus brief in 2023 opposing proposed index fund mergers on concentration grounds. However, no major regulatory action has materialized. This reflects both political influence of the Big Three and uncertainty about applying existing law to passive structures.

Q: Does Vanguard's mutual ownership structure prevent abuse?

A: Theoretically, yes. As a mutual company (owned by its investors), Vanguard's incentives theoretically align with beneficiary interests rather than extraction. However, SEC correspondence and shareholder voting records show Vanguard exercises identical shareholder influence as BlackRock and State Street. The governance structure is a useful firewall against certain financial abuses but does not prevent shareholder activism or voting coordination.

Q: What would happen if one of the Big Three faced a major crisis?

A: Given their holdings span 7,444+ non-US corporations, a crisis at any Big Three entity could trigger forced liquidation across global equity markets simultaneously. The 2020 COVID crash provided a small preview: index fund redemptions required synchronized selling, which exacerbated declines. A major redemption wave at BlackRock or Vanguard would create downward pressure on every index constituent simultaneously, potentially cascading into broader financial instability.

Q: Have any countries implemented limits on Big Three concentration?

A: No regulatory jurisdiction has successfully implemented concentration limits on passive index funds, though several have proposed frameworks. The UK FCA conducted inquiries into market concentration risks. Germany's BaFin study recommended concentration monitoring. The EU Parliament passed non-binding resolutions. No enforcement actions or mandatory limits exist. Political pressure from the Big Three (through regulatory capture and lobbying influence) has prevented legislative action.

Conclusion

The concentration of global shareholding power among BlackRock, Vanguard, and State Street is not hypothetical—it is documented across thousands of SEC Form 13F filings, peer-reviewed academic research, and regulatory reports. These three entities collectively hold controlling stakes in 7,444+ non-US corporations, representing the largest single bloc of shareholder power in human history.

Unlike previous eras of "robber baron" capitalism, where individual moguls or families held concentrated stakes in specific industries, the Big Three exercise diffuse influence across all industries simultaneously. This creates novel governance challenges for which existing regulatory frameworks are inadequate.

Policymakers, international bodies, and academics have begun documenting the pattern. The Federal Reserve, SEC, FTC, and European Parliament have all issued formal statements acknowledging concentration risks. However, political influence exerted by the Big Three through regulatory capture, lobbying, and board-level coordination has prevented legislative action.

The public evidence exists. The mechanism is understood. What remains is regulatory will to implement transparency, concentration limits, or structural reforms—unlikely to materialize given the Big Three's outsized influence over the regulators tasked with oversight.