News Digest: New Trump Order Challenges Proxy Firms, Threatening Shareholder Rights
December 18, 2025
A new White House order targeting proxy advisory firms Institutional Shareholder Services (ISS) and Glass, Lewis & Co. is being viewed by corporate governance analysts as a major escalation in a Republican effort to weaken shareholder power and concentrate authority in the hands of corporate CEOs.
According to a Reuters report, President Donald Trump directed the U.S. Securities and Exchange Commission (SEC) to increase oversight of these influential firms, which provide voting advice to large institutional investors. The order claims the proxy firms use their power to “advance and prioritize radical politically-motivated agendas,” particularly those concerning environmental, social, and governance (ESG) issues, at the expense of shareholder returns.
Attorney Sanford Lewis argues the order is based on the premise that diversity or environmental concerns do not relate to financial performance, a view contradicted by many investors who see strong ESG policies as boosting long-term value. Similarly, Sarah Wilson, CEO of Minerva Analytics, called the move “geopolitical warfare through financial markets,” noting that her European clients worry the order will interfere with their need for “good returns over time that are well risk-adjusted.”
Crucially, the directive also asks the SEC to consider “revising or rescinding all rules” related to shareholder proposals. This move worries investor activists, as such proposals are a key tool used by shareholders to push for corporate accountability on issues ranging from CEO pay limits to board diversity.
While U.S. business groups praised the order for aiming to remove “politics out of business decisions,” attorneys see it as part of a “once-in-a-generation governance recalibration.” If followed through, the measures would significantly reduce the ability of investors to pressure companies through proxy campaigns, effectively strengthening corporate management against shareholder input.
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