And would an executive order forcing asset managers to pass voting back to end investors make sense?

The Federal Trade Commission’s (FTC) antitrust probe into proxy advisor Institutional Shareholder Services (ISS) and Glass Lewis appears motivated more by politics than genuine competition concerns.

These firms, which provide research and recommendations to help institutional shareholders cast informed votes, have been subject to vitriol from high-profile public figures concerned they are forcing a ‘woke’ agenda upon American companies.

After recommending investors vote against Elon Musk’s $1trn Tesla pay package, the billionaire labelled ISS and Glass Lewis “corporate terrorists” and said “they have no freaking clue” on a company earnings call.

Cathie Wood, CEO of ETF provider ARK Invest, added: “Isn’t it sad, if not damning, that institutional shareholders rely on proxy firms to tell them how they should vote?” she wrote in a recent post on X, formerly Twitter.

But Wood appears to be wide of the mark. A trio of academics in a recent paper called Custom Proxy Voting Advice found that 80% of funds using these services already received customised advice that differed significantly from the “benchmark” recommendations – a number that will surprise many.

Read more on ETF Stream here.