Glass Lewis faces backlash and considers major voting policy changes

In the United States, Glass Lewis, a proxy advisory firm, is contemplating significant alterations to its methodology for advising shareholders on corporate votes. This change is partly a response to Increasing conservative criticism aimed at its previously established 'house views' regarding various ballot measures, including those focused on corporate governance and social responsibility issues. This discussion has emerged during the first year of Bob Mann's tenure as CEO of Glass Lewis and follows an ongoing investigation by House Republicans into Glass Lewis and its competitor, Institutional Shareholder Services (ISS). The shift signals an evolution in the proxy advisory landscape, wherein firms like Glass Lewis and ISS dominate approximately 90% of the shareholder-advice market. Critics argue that this consolidation has allowed an ideological agenda to influence corporate decision-making processes. The backlash against firms like Glass Lewis initiated discussions around the need for advisory services to reflect more diverse perspectives, attempting to realign services with investor sentiments. This reevaluation coincides with a broader trend as other major investment firms, such as BlackRock and Vanguard, have similarly dialed back on their progressive stances, particularly the demands for increased representation of women and minority members on public company boards. This pivot is viewed as a response to the shifting priorities of their clients, who are now more inclined towards customized voting policies that align with their individual interests rather than adhering to a uniform house viewpoint. The forthcoming adjustments to Glass Lewis's voting recommendations may unfold over the next few years, during which explicit recommendations from the firm are expected to remain available to shareholders. This decision could significantly alter the dynamics of shareholder voting practices and the influence that proxy advisory firms exert on corporate governance.