AG TAKES AIM: Anti-Bias Lawsuit FILED

Missouri Attorney General Andrew Bailey is taking a bold stand against influential shareholder voting advisors, accusing them of undermining conservative values and promoting a left-wing agenda.

At a Glance

Missouri AG Andrew Bailey sues ISS and Glass Lewis for alleged left-wing bias.
The lawsuits challenge the firms’ promotion of ESG and DEI agendas.
Proxy advisory firms control over 90% of the market, influencing major corporate decisions.
This legal action intensifies the national debate over corporate governance and ESG policies.

Missouri’s Legal Battle Against Proxy Advisors

Missouri Attorney General Andrew Bailey has launched a significant legal battle against the dominant proxy advisory firms Institutional Shareholder Services (ISS) and Glass Lewis. These firms, controlling a staggering 90% of the proxy advisory market, are under fire for allegedly pushing environmental, social, and governance (ESG) and diversity, equity, and inclusion (DEI) agendas. Bailey’s lawsuits, filed in July 2025, accuse these firms of promoting a left-wing agenda that conflicts with shareholder interests and fiduciary duties.

Proxy advisors play a crucial role in shaping corporate decisions by providing institutional investors with recommendations on voting their shares at annual meetings. These recommendations significantly influence board elections, executive compensation, and policy proposals. However, Bailey and other conservative officials argue that the firms’ ESG and DEI priorities diverge from the genuine interests of shareholders.

The Broader Debate on Corporate Governance

This legal action is part of a broader national debate over the role of ESG and DEI in corporate governance. Conservative leaders argue that these priorities conflict with shareholder value and fiduciary responsibilities. The lawsuits come on the heels of a 2023 letter signed by 23 state attorneys general, which raised concerns about potential breaches of fiduciary duty by ISS and Glass Lewis, specifically regarding alignment with climate change goals.

Missouri’s lawsuits against these proxy advisors aim to ensure compliance with state investigative demands. Bailey has served a Civil Investigative Demand (CID) on Glass Lewis, seeking documents related to their policy recommendations. The lawsuits allege that the firms violate the Missouri Merchandising Practices Act by engaging in potentially fraudulent practices and failing to act impartially.

Impact and Implications of the Lawsuits

The lawsuits could have significant short-term and long-term implications. In the short term, Glass Lewis and ISS face increased legal pressure to comply with subpoenas and defend their business practices in court. Institutional investors, reliant on proxy advisory services, may experience uncertainty regarding the neutrality of these recommendations.

If Missouri’s legal efforts succeed, it could set a regulatory precedent that encourages other states to pursue similar actions, leading to increased state-level oversight of proxy advisors. Furthermore, these firms might need to alter their methodologies or increase transparency regarding ESG and DEI considerations.

Reactions and Diverse Viewpoints

Supporters of the lawsuits, including advocacy groups like Consumers’ Research, argue that proxy advisors have overstepped their mandate by pushing an anti-consumer agenda. However, critics contend that these lawsuits are politically motivated, aiming to suppress shareholder rights and activism rather than address genuine legal violations.

Some business groups and conservative officials view the lawsuits as a necessary measure to protect shareholder value and prevent ideological overreach. Meanwhile, governance experts warn that undermining proxy advisors could weaken shareholder oversight and corporate accountability. The debate over the role of ESG and DEI in business continues to polarize opinions, intensifying the political discourse surrounding corporate governance.