Warren Davidson Criticizes Foreign Proxy Firms for Activism Masquerading as Advice

Foreign Ownership of Proxy Advisory Firms

• 🇺🇸 Rep. Warren Davidson highlights concerns over foreign-owned proxy advisory firms, ISS and Glass Lewis, and their significant influence on US capital markets.
• 🇩🇪 ISS, originally US-founded, is now majority-owned by Germany's Deutsch Borse Group, impacting how US institutional investors vote trillions in shares.
• 🇨🇦 Glass Lewis, founded in the US, was acquired by Toronto-based private equity firm Peloton Capital Management in 2021.

Market Dominance and Influence

• 📊 Together, ISS and Glass Lewis control 97% of the proxy advisory space, influencing votes on board elections, ESG mandates, and corporate policies.
• ⚠️ Davidson questions why these foreign-controlled firms aren't subject to CFIUS review, given their outsized impact on corporate governance and potential for injecting foreign biases.
• 📈 Concerns are raised about European-style green mandates or Canadian anti-growth policies potentially undermining American competitiveness.

Shareholder Proposals and Activism

• 📜 The shareholder proposal process (Rule 14A8) was intended for real shareholders but has become a