MFDF - Mutual Fund Directors Forum - Scrutiny on Proxy Advisory Firms as Legislators Question Potential for Conflicts test

Member Login

Request an account

Sample Banner 2

Scrutiny on Proxy Advisory Firms as Legislators Question Potential for Conflicts

The Financial Times is reporting that U.S. regulators are seeking more information on proxy advisory firms ISS and Glass Lewis, who critics claim are dominating firms’ corporate governance work as a result of the rise in passive investing. A U.S. Treasury Report on the capital markets sector observed that there was “inadequate oversight and accountability of proxy advisory firms” and recommended further study and evaluation of these firms, including regulatory responses if appropriate. A House bill, which is included in a list of broader financial reforms that is currently moving through Congress, requires proxy firms to register with the SEC, disclose the procedures and methodologies proxy advisors use in developing proxy voting recommendations and any potential or actual conflicts of interest, including whether the proxy advisory firm engages in services ancillary to the provision of proxy advisory services such as consulting services for corporate issuers. The bill has been sharply criticized by some industry participants as anti-competitive and possibly unconstitutional.

  • All
  • Accounting and Audit
  • Advisory Contracts
  • Board Governance
  • Board Governance: Board Leadership
  • Board Governance: Compensation
  • Board Governance: Oversight of CCO
  • Board Governance: D&O Insurance
  • Board Governance: Self-Evaluation
  • Closed-end Funds
  • ETFs
  • Other Oversight
  • Other Oversight: Alternative Investments and Derivatives
  • Other Oversight: Custody
  • Other Oversight: Fixed Income funds
  • Other Oversight: Distribution
  • Other Oversight: Portfolio Trading
  • Other Oversight: Proxy Voting
  • Other Oversight: Securities Lending
  • Legislative News
  • Money Market Funds
  • Reference
  • Regulatory News
  • Risk
  • Shareholder Disclosure
  • Valuation
  • Webinars
  • Aaron New Tag