SEC Sues Proxy Adviser ISS Over Subpoena
SEC Sues Proxy Adviser ISS Over Subpoena
The News
The Securities and Exchange Commission has sued Institutional Shareholder Services to force the proxy adviser to turn over records about how it makes recommendations and casts votes for investors.
The SEC filed the subpoena-enforcement action Friday in the U.S. District Court for the Eastern District of Pennsylvania, saying ISS refused to fully comply with an administrative subpoena, CNBC reported.
ISS is one of two firms whose recommendations move votes at thousands of shareholder meetings. The regulator says its investigation is still in the fact-finding stage and that it has not concluded ISS broke any federal securities law.
Why It Matters
Proxy advisers give institutional investors research and recommendations on shareholder votes covering board elections, executive compensation and shareholder proposals. The White House has said ISS and rival Glass Lewis together control more than 90% of that market.
Timeline
President Donald Trump signs an executive order directing the SEC to review its rules and guidance on proxy advisers, enforce securities-law antifraud provisions and consider additional disclosure and regulatory requirements, according to CNBC. The order specifically names ISS and Glass Lewis.
The SEC's Division of Examinations begins reviewing ISS and requests data related to the firm's recommendations and votes.
After ISS does not produce all of the requested information, the SEC's enforcement division opens an inquiry and issues a subpoena.
The SEC files its subpoena-enforcement action in the Eastern District of Pennsylvania, saying ISS has continued to withhold some records despite extended deadlines and repeated efforts to resolve the dispute.
CNBC and the Financial Times report the filing. The FT says the SEC accuses the firm of ignoring a subpoena as part of its "fact-finding investigation."
Reactions
ISS argued in correspondence with the SEC that the subpoena raised First Amendment concerns and could expose the firm and its clients to retaliation over their voting activity, according to CNBC.
ISS did not immediately respond to CNBC's request for comment.
The SEC, for its part, has been careful about what it is and is not alleging: the agency said the investigation remains fact-finding and that it has not concluded ISS violated federal securities laws. It is asking the court to order the firm to comply with the outstanding subpoena — nothing more, at this stage.
What's Next
The case now sits with a federal judge in the Eastern District of Pennsylvania, who will decide whether to order ISS to hand over the withheld records.
The underlying SEC inquiry continues either way. And the broader Trump administration effort to tighten oversight of proxy advisers — set in motion by the December executive order — is still working through the agency's rulemaking and enforcement machinery.
More
ISS is registered with the SEC as an investment adviser, which is what gives the agency's examination and enforcement divisions a direct line into its books.
The lawsuit is a subpoena-enforcement action, not an enforcement case alleging wrongdoing. In practice that means the fight in court is over documents — whether the SEC gets what it asked for — rather than over whether ISS did anything illegal.
Poll
Should the SEC be investigating proxy advisers like ISS?
Colleges Condemn Students Mocking Kirk Assassination Anniversary
Charleston White Arrested Again on Florida Battery Charge
Sep 13, 2026
Border Patrol Rescues MS NOW Crew in Desert
Sep 13, 2026
Supreme Court Restores Missouri's Old House Map
Sep 13, 2026
Alaska Drops Felony Voter Charges Against Samoans
Sep 13, 2026
Trespasser Breaches Harris' Malibu Estate; No Arrest
Sep 12, 2026
Hegseth Pressed Downed Airmen Into 60 Minutes
Sep 12, 2026
Houthis Seize Mokha, Choking Saudi Oil Exports
Sep 12, 2026
Altman Rules Out OpenAI IPO This Year
Sep 12, 2026
Jury Acquits Lil Durk in Murder-for-Hire Case
Sep 12, 2026
Judge: Trump Broke Law Halving FEMA Staff
Sep 12, 2026
Maher Calls Democrats' Gaza Genocide Claim a Lie
Sep 12, 2026
Blizzard Revives StarCraft, Sends Diablo to Netflix
Sep 12, 2026
Trump's Queens Childhood Home Sells for $1.93M
Sep 12, 2026
Scientists Find New Virus in Tick Invading US
Sep 12, 2026
Britain Bans Settlement Imports; US States Threaten Payback
Sep 12, 2026
Prison Fire Kills 7 as Kurds Protest Killing
Sep 12, 2026
Kosovo Rallies for Ex-President Before Hague Verdict
Sep 12, 2026
Cruz Booed at GameDay Over College Sports Bill
Sep 12, 2026
Blast Hits Bulgarian Arms Plant Supplying Ukraine
Sep 12, 2026
Sep 13, 2026