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4d ago

DOJ Withdraws 1987 Business Review Letter for Proxy Adviser ISS

The withdrawal removes a decades-old assurance because the Justice Department says ISS’s expansion into corporate consulting and its dominant market position create competition risks that could prompt enforcement or rulemaking.

Shadows are cast on a sign at the Department of Justice building in Washington, D.C., U.S., September 23, 2025. REUTERS/Kevin Lamarque
Via foxnews.com

Overview

  • The Antitrust Division announced Wednesday that it is withdrawing the 1987 Business Review Letter it issued to Institutional Shareholder Services, saying the letter no longer reflects ISS’s current business practices.
  • The department said ISS now offers corporate consulting alongside proxy voting advice, a dual-client model that departs from the 1987 assumptions and raises conflicts tied to competition and corporate governance influence.
  • DOJ noted that ISS and Glass Lewis together control more than 90 percent of the proxy advisory market, giving those firms outsized sway over shareholder votes at large U.S. public companies.
  • The withdrawal is not an enforcement action or lawsuit but it removes longstanding legal reassurance and increases the chance of future antitrust challenges, regulatory rulemaking, or agency actions.
  • The move builds on a wider push by federal actors, including President Trump’s December 2025 executive order and April 2026 Department of Labor guidance, and could affect how pension funds and asset managers use proxy advice.