Washington, D.C. – Club for Growth Foundation issued the following statement of support for President Trump’s recent executive order limiting the influence of proxy advisors from American shareholders:
“We strongly support President Trump’s new executive order, Protecting American Investors from Foreign-Owned and Politically-Motivated Proxy Advisors. The White House has taken an urgent and long-overdue step toward reining in the outsized influence of proxy advisors and index-fund managers. The Club for Growth Foundation strongly affirms this action and highlights several key facts that underscore why decisive reform is necessary to protect American shareholders.” – David McIntosh, President, Club for Growth Foundation.
A Near-Total Duopoly Over Americans’ Retirement Savings
Institutional Shareholder Services (ISS) and Glass Lewis—two private firms unknown to most Americans—control an estimated 90–97% of the proxy advisory market. Their recommendations shape how pension funds, university endowments, foundations, and major mutual fund providers vote on corporate governance issues. In practice, the decisions of these two companies directly effect the financial well-being of more than 100 million American shareholders.
Foreign Ownership Raises Red Flags
Both firms are majority-owned by foreign entities. Glass Lewis has been owned since March 2021 by the Canadian private-equity firm Peloton Capital Management (PCM), having been purchased from another Canadian firm. ISS, founded in the U.S. in 1985, has been sold eight times, and since 2020, it is now 80% owned by Deutsche Börse, a German company.
Ideological Agendas Masquerading as Governance
Proxy advisory firms’ data and recommendations for “good” corporate governance are not always in the best interest of maximizing shareholder value. For example, on November 20, 2025, the State of Florida filed a lawsuit against ISS and Glass Lewis for violating the Florida Antitrust Act and the Florida Deceptive and Unfair Trade Practices Act (FDUTPA). The complaint alleges the firms have “used this enormous influence to push their own dogmatic agenda, one that seeks to require publicly traded companies to strictly adhere to highly controversial—and, in some cases, illegal—policies. Quotas for outright racial balancing, gender ideology that promotes genders beyond male and female, and an insistence that concerns about global climate change should influence every company’s decision-making are [their] basic requirements.”
Conflicts of Interest Are Baked Into the Business Model
Both firms routinely provide consulting services to the same companies on which they later issue voting recommendations—a sweeping conflict of interest that, at present, does not have to be disclosed. As Florida’s complaint notes, this practice undermines the integrity of recommendations supposedly made in the best interest of ordinary shareholders.
Error-Prone Research and Questionable Staffing
Proxy season brings a rush of hiring, with firms relying heavily on temporary workers to generate voting recommendations on complex corporate matters. Numerous recent job postings by ISS and Glass Lewis show the extent of this churn, raising concerns about accuracy, rigor, and accountability in the data that influences trillions of dollars in shareholder value.
The Broader Problem: Index Funds Are Voting Your Shares—Not You
While outside the scope of today’s brief, the Foundation notes growing concerns about major index-fund managers such as BlackRock, State Street, and Vanguard automatically voting shares on behalf of individual investors—often rubber-stamping ISS and Glass Lewis recommendations. As outlined in the “double dilution” argument (National Review, 2023) made by Michael Ryell and Siri Terjesen of the Madden Center for Value Creation at Florida Atlantic University College of Business, this practice weakens true shareholder voice. The Trump Administration has the authority to curb or eliminate this practice in terms of removing votes by these institutions.
Cosmetic Reforms Aren’t Enough
Amid rising scrutiny, Glass Lewis recently announced it would stop issuing “cookie-cutter” recommendations to institutional clients. While this acknowledges the problem, it does not resolve the systemic issues of market concentration, foreign control, ideological bias, or conflicts of interest.
The Club for Growth Foundation applauds President Trump’s executive order and urges both the Administration and the Securities and Exchange Commission (SEC) to continue boldly restoring accountability, competition, and transparency to the proxy advisory system—returning decision-making power to American investors and safeguarding the integrity of U.S. capital markets.