Glass Lewis has announced a significant overhaul to its research and voting recommendation services, citing the diverging priorities of investors in the US and Europe, particularly regarding sustainability and corporate engagement. The firm will cease providing singular voting advice, acknowledging that differing regional perspectives are influencing approaches to fiduciary duty, engagement strategies, and sustainability commitments.
The decision comes amid increased scrutiny from US Republican politicians, including a recent investigation by the Texas Attorney General into Glass Lewis and ISS. The investigation alleges that these companies potentially misled investors by recommending votes in favour of companies implementing diversity, equity, and inclusion (DEI) and sustainability policies.
Glass Lewis highlighted rapid technological advancements, particularly in artificial intelligence, which are enabling more customised voting approaches. This allows asset managers and pension funds greater control over their proxy voting decisions. The firm aims to assist clients in developing voting frameworks aligned with their individual investment philosophies and stewardship priorities, moving beyond standardised policies.
The company will transition from singularly-focused research and vote recommendations based on its house policy, to providing multiple perspectives that reflect different clients’ viewpoints, such as management or various governance fundamentals. These changes will be implemented over the next two years, with clients able to access the diverse perspectives to inform their proxy voting decisions by 2027.
Bob Mann, CEO of Glass Lewis, stated that as institutional investors adopt increasingly diverse voting preferences, the traditional one-size-fits-all model of proxy advice is no longer sufficient. Investors now seek proxy voting frameworks and guidance that align with their unique investment strategies, stewardship goals, and voting preferences.
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