Institutional Shareholder Services (ISS) CEO Gary Retelny has issued a statement reinforcing the proxy advisors’ “apolitical” role in ESG investing and criticizing the “growing chorus of partisan attacks” that claim the advisor is pushing an ESG agenda.
In a June 13 letter, Retelny said it was “time to set the record straight and stop politicizing proxy advice,” making clear ISS is “impartial” and allows investors to vote in line with a number of custom-made policies that are tailored to clients’ unique circumstances and preferences.
“The narrative being spun about ISS is part of a broader, highly partisan attack on ESG investing,” Retelny’s letter reads. “In 2022, a record year for environmental and social shareholder resolutions, ISS’ benchmark policy supported just 52% of all shareholder proposals characterized as ‘environmental’ or ‘social,’ while supporting more than 96% of management resolutions.”
“This is hardly the track record of an advocacy organization pushing an ESG agenda,” he continued.
Retelny went on to suggest that state policymakers which seek to restrict the use of ESG considerations in investment decision-making are failing to encourage responsible fiduciary conduct.
“ISS recognizes that any proxy vote recommendation that includes a consideration of ESG factors will continue to be attacked, just as any failure to support an ESG proposal may be attacked by an unsuccessful shareholder proponent,” Retelny said. “But we are not engaged in a popularity contest.”
ISS and Glass Lewis have both been subject to sustained pressure on the part of Republican policymakers to amend their ESG policies. In January, a group of 21 Republican state attorneys wrote to both advisors, suggesting both have breached their legal and contractual duties by advocating for corporate alignment with climate goals and diversity quotes. Both advisors refuted these claims.