Fund managers slammed for investing in Facebook and Google while arguing against such firms listing in the FTSE 100

Some of the biggest investors speaking out against allowing companies into the FTSE-100 with dual classes of shares have invested billions in such stocks in the US, giving rise to claims of hypocrisy.

The Government wants to attract tech companies to IPO here and is considering copying the US model by allowing dual class shares onto its premium indexes. 

In dual class shares, management have greater powers than external shareholders.  

Facebook, Alphabet (Google) and other US tech stocks have such a structure but big investors including BlackRock, Legal & General and Columbia Threadneedle oppose changes allowing dual class shares a premium listing in the UK.

Data from FactSet, however, shows that BlackRock has invested $259.1 billion (£196.9 billion) in US dual class share firms, LGIM $15.4 billion (£11.7 billion) and Threadneedle $3.2 billion (£2.43 billion). Invesco has $1.5 billion (£1.14 billion).

“It’s time to say, why block change in the UK when you’ll invest in Mark Zuckerberg?” said one IPO banker.  

Iain Richards, head of responsible investments at Columbia Threadneedle said: “A premium listing on the London market is the UK’s gold standard.  

“A race to the bottom would risk undermining a key part of London’s appeal and reputation for quality.”

BlackRock said its funds were largely trackers so it had no choice where it invested clients’ cash.  

L&G said it was opposed to dilution of the “one share one vote” principle and acted to block Snapchat owner Snap from US indexes. 

Investors must be able to hold managements to account, it said.

Dual class shares are also controversial in the US.  

Investors there are seeking sunset clauses and other remedies.

Matthew Moulding, founder and chief executive of The Hut Group, which staged Britain’s biggest float in five years in September, yesterday told the Evening Standard it was time to overhaul the UK listing rules.