Forbes' Mark Chenoweth: Proxy Advisory Services: Making Glass (Lewis) Transparent -- And ISS Too

Proxy Advisory Services: Making Glass (Lewis) Transparent -- And ISS Too

Mark Chenoweth, Contributor

Thanks to a second 2004 no-action letter, SEC has also instructed proxy advisory firms that they can provide advice to public companies on corporate governance issues—including how to win proxy votes—at the same time that they make proxy voting recommendations to investment advisers.  As James Glassman and J.W. Verret wrote in a Mercatus Center analysis last April, “Instead of eliminating conflicts of interest, the rule simply shifted their source.  Instead of encouraging funds to assume more responsibility for their proxy votes, the rule pushes them to assume less.”