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May 10, 2019

Institute for Pension Fund Integrity Event Underscores Importance of SEC Action on Proxy Advisors

Yesterday, the Institute for Pension Fund Integrity held a panel on proxy advisory firms, ESG investing and public pensions.  Opening the discussion was Representative Sean Duffy (R-WI) articulating his position on proxy advisory firms and the “racket” they bring to the process for every-day retail investors.

May 1, 2019

CalPERS Continues to Ignore its Fiduciary Duty to Pensioners

The California Public Employees’ Retirement System (CalPERS) is set to put a “laser-like focus” this proxy season on social issues like board diversity and executive pay. This is despite increasing concerns about CalPERS’ poor financial performance and pressure from the federal government to make sure public pension funds are making investments to increase returns. According ...

April 19, 2019

SEC Investor Advocate Ignores Key Criticisms of Proxy Advisors, Concerns of Retail Investors

Fleming delivered his remarks just a few days before a new study was published by the Spectrum Group which concluded, “retail shareholders are too often being used as a poster child by institutional intermediaries to support practices in shareholder voting that retail investors do not support.” The survey also found that 85 percent of investors support increased SEC oversight after being made aware of issues with proxy advisors.

April 10, 2019

New study proves that retail Investors support regulation of proxy advisory firms

A study recently published by Spectrem Group quantifies how retail investors feel about proxy advisory firms, revealing the wide disconnect between investors’ desires and proxy advisors’ practices. The survey concludes that “retail shareholders are too often being used as a poster child by institutional intermediaries to support practices in shareholder voting that retail investors do not support.”

April 3, 2019

Senate hearing reiterates need for proxy reform to consider interests of retail investors

This week, the Senate Committee on Banking, Housing and Urban Affairs held a hearing on the “The Application of Environmental, Social, and Governance Principles in Investing and the Role of Asset Managers, Proxy Advisors, and Other Intermediaries.” The committee heard from three witnesses: The Honorable Phil Gramm, a former U.S. Senator; James R. Copeland, Senior ...

March 25, 2019

New Glass Lewis Program Capitalizes on Transparency Concerns

Glass Lewis recently launched a new 2019 pilot program to allow companies and shareholder proposal proponents to review and respond to the advisor’s recommendations. The announcement comes after months of unprecedented scrutiny of proxy advisors from the Securities and Exchange Commission (SEC), Congress, companies and retail investors – all of whom are concerned about companies’ inability to weigh in on recommendations.

March 20, 2019

Newest SEC Commissioner Raises Critical Questions to the Proxy System

Roisman outlined certain practices within the proxy system that are damaging to the shareholder voting process.  He described how many fund managers are automatically voting in line in line with proxy advisory recommendations (even if these recommendations negatively impact returns), a trend now referred to as “robo-voting”. Roisman also stated that he was concerned about factual errors being used to justify these voting recommendations and noted the potential for conflicts of interest to arise between proxy firms and the firms they provide consulting services to.

March 8, 2019

New, Concrete Ideas for How the SEC Can Rein in Proxy Advisors and Help Retail Investors

Members of the Main Street Investors Coalition are weighing in this week with a number of ideas for the Securities and Exchange Commission (SEC) to implement that could protect retail investors from the undue influence of proxy advisors. The National Association of Manufacturers (NAM) submitted a new comment to the SEC and Bernard Sharfman, academic ...

March 6, 2019

Speaking Before Institutional Investors, SEC Commissioner Peirce Slams ESG, Reminds them of their Fiduciary Duty

Commissioner Peirce was speaking at a conference organized by the Council of Institutional Investors (CII). CII manages $4 trillion in assets through pension funds, foundations and endowments and members of CII manage a collective $35 trillion. Her speech titled  “Festivus, Fortnite, and Focus”  touched on many of the same themes discussed at the SEC’s roundtable on the proxy process last November, including the lack of shareholder proposal submission thresholds and the fiduciary duty of asset managers.