Andrew Bailey
JEFFERSON CITY — Missouri Attorney General Andrew Bailey has launched a formal investigation and filed lawsuits against proxy advisory giants Glass Lewis and Institutional Shareholder Services.
The AG accuses the foreign-owned firms of promoting politically motivated environmental, social and governance and diversity, equity and inclusion agendas under the guise of impartial investment advice.
The lawsuits, filed in Cole County Circuit Court, seek court orders to compel both companies to comply with Civil Investigative Demands issued under the Missouri Merchandising Practices Act.
The two firms, which together control over 97% of the U.S. proxy advisory market, play a critical role in shaping how institutional investors cast votes at shareholder meetings.
Their recommendations can influence decisions on executive pay, board elections, company policies, and shareholder proposals, despite the firms not owning any shares themselves.
Missouri officials allege that this influence has been leveraged to promote what Bailey called a “radical” ideological agenda that could negatively impact shareholder value and financial returns for investors, including retirees and families in Missouri.
“Glass Lewis and ISS have evaded scrutiny for too long,” Bailey said in a statement. “Missourians deserve answers as to why the unseen power brokers, controlling much of corporate America, are pushing a leftist worldview at the expense of millions of honest investors.”
In separate court filings, the Missouri Attorney General’s Office argued that both companies are violating state consumer protection laws by misrepresenting the objectivity and financial neutrality of their voting recommendations. Glass Lewis, according to the petition, describes itself as the “world’s choice” for providing research that helps institutional investors make “informed decisions based on research and data.”
However, Missouri contends that Glass Lewis’s public statements and policy documents reveal a commitment to advancing DEI and environmental causes—often regardless of the financial consequences.
The petition cites Glass Lewis’s 2025 Benchmark Policy Guidelines and supplemental statements, which outline a framework for flagging proxy votes that do not align with the firm’s DEI standards.
The firm has pledged to recommend votes against board members deemed insufficiently diverse or failing to meet certain environmental benchmarks, including carbon emissions targets. Missouri’s filing argues that these positions amount to a concealed ideological bias that misleads clients and undermines their fiduciary duties to shareholders in the state.
Similarly, the lawsuit against ISS claims the company falsely markets its proxy services as “objective and impartial,” while actively promoting environmental and DEI initiatives.
Public documentation from ISS reveals support for shareholder proposals aligned with “net zero emissions” strategies and diversity mandates, yet the firm allegedly fails to disclose how it weighs these considerations in its decision-making process or how such stances might affect a client’s return on investment.
The court filing against ISS references its 2025 Sustainability Proxy Voting Guidelines, which explicitly recommend supporting environmental and social proposals but do not provide transparency about the methodology or financial trade-offs involved.
This omission, the suit states, constitutes a violation of the MMPA, which prohibits deceptive practices in trade and commerce.
Because both Glass Lewis and ISS have resisted similar investigative efforts in other states, Bailey’s office is seeking judicial intervention to compel the firms to respond to Missouri’s CIDs within 20 days.
“These proxy advisors have held corporate America hostage with their radical ideologies,” Bailey said in a statement. “We are putting them on notice: Missouri will not tolerate ideological coercion disguised as investment guidance.”
Cole County Circuit Court case number: 25AC-CC05436, 25AC-CC05437
