SUPPORT

“Just because investors often vote the same way that advisers recommend does not mean investors are following their recommendations; instead, it is a reflection of proxy advisers’ policies being closely aligned with those of their investor clients. Proxy advisers’ policies are strongly influenced by clients’ preferences gleaned through surveys, market trends and annual due diligence visits.”

“Muzzling independent research firms would only reward underperforming CEOs and stifle oversight…on Nov. 5 [2019] the SEC proposed a new rule that would require proxy advisory firms to give a preview of their reports to the very companies that are the subjects of those reports—this before investors can read the advice they purchased. This odd arrangement would allow corporations to interfere with advisers’ research—a recipe for disaster.”

“It is our informed belief, based on years of experience working with proxy advisory firms as both an issuer and an institutional investor, that proxy advisers do not need oversight by issuers in order to provide accurate research reports.” 

“[Proxy advisers] supplement clients' internal capacity, both in terms of expertise and workload. [They] provide a perspective that is independent of company management, directors and dissident shareholders…”

 “[Codifying proxy voting advice] as solicitation is deeply concerning from an investor protection and analyst independence perspective.”

"The interests of shareholders in receiving timely and independent proxy voting advice should not be made subservient to the desires of companies who wish to avoid an adverse vote recommendation by proxy voting advisers.”

“I think it is fair to say that investors are wary about efforts to regulate proxy advisers….Some have criticized proxy advisers and allege that they have conflicts of interest in their business models, factual errors in their analytical processes, and a political agenda that supports social policies at the expense of investment returns. All of these things would cause me great concern, except for one thing—the investors who are paying for this service are not the ones who are expressing those concerns."

“Institutional investors’ costs of stewardship can be substantial, as they face ballots at thousands of portfolio companies. One way they can potentially reduce these costs is by hiring proxy advisers such as Institutional Shareholder Services (ISS) or Glass Lewis, which provide research, vote recommendations, and vote execution services.”

“Investment advisers routinely vote proxies on behalf of and in the best interest of their clients. In so doing, they retain the services of proxy advisory firms, which provide important support, particularly voting-related administration services. Indeed, investment advisers of all sizes would face extreme logistical difficulty if they were unable to use these services to assist in the mechanics of voting proxies and for research.”

“Proxy advisory services … are not a substitute for the exercise of our own independent judgment on how to vote our portfolio company shares. Rather, the information and services provided by proxy advisory firms help us use our resources efficiently to make informed, independent voting decisions based on our own policies and strategies. In that way, we believe our use of proxy advisory services ultimately serves our clients’ best interests.”

“When casting their votes, investors inform and make their decisions based on multiple and variable inputs, such as in-house voting policies, investment theses, constructive engagement with companies, as well as research provided by third parties. Exactly what these inputs are will vary by manager and investment due diligence approach. Proxy advice is one of several sources of information that aid investors making voting decisions. The use of the services of proxy advisers does not replace or outsource fiduciary decisions. The investor remains the decision-maker.”

“While we ultimately make our own decisions, proxy advisory firms provide valuable research, grounded in governance best practices. Their work enhances transparency, promotes accountability and empowers shareowners to exercise their rights effectively….Eliminating these firms would not only harm institutional investors, but also would weaken the corporate governance system as a whole.”

“So we vote all our proxies at US companies we subscribe to both ISS and Glass Lewis to get information, and my team review that information as we make our independent decisions. So their advice is just advisory. Most of the time they side with management when there is a difference between management and proposal bringers, and it's worth remembering that the shareholder proposals themselves are advisory. They don't dictate policy to companies.”

“…our proxy adviser has become an important component of our shareholder outreach and engagement efforts. Their specialization and resources have allowed us to fulfill our governance obligations, as well as our fiduciary duty to our members, in a more informed, productive, and efficient manner.”

The Commission should not “treat[] opinions on proxies as proxy solicitations.” 

“State and local pensions play an important role in their local communities, and their ability to continue this role depends on responsible management and investment of the pension fund assets. To meet their fiduciary duty, fund administrators rely on the expert advi[c]e of investment advisers and proxy advice firms to provide timely analysis to inform proxy voting policies”

“As a small-size institutional investor, to do informed voting on that significant number of companies and ballot items, Mercy Investments retains a proxy advisory firm to assist us. Mercy Investments does not cede voting decisions to our proxy advisory firm. Rather, annually, we approve our own proxy voting guidelines and the proxy advisory firm is charged with implementing them. While we rely on their independent analysis and advice to ensure votes are cast in a manner aligned to our voting guidelines, we regularly audit our voting to ensure our votes have been cast as required by our proxy voting guidelines; we have found the voting by the firm to be consistent with our guidelines. In addition, at any time, we can review, question, or change the ballots cast.”