Two foreign-owned firms have been quietly running American boardrooms. Now a coalition of state attorneys general is moving to stop them. Nebraska Attorney General Michael Hilgers filed a lawsuit Wednesday against Institutional Shareholder Services (ISS), accusing the firm of pushing climate and DEI agendas on corporate America while telling its clients it was giving them straight, neutral advice. Attorneys general from at least 17 states are backing the effort.
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ISS and its competitor Glass Lewis are proxy advisory firms, businesses that tell large investors, pension funds, and mutual funds how to vote their shares in corporate elections. Think of them as the firms that quietly decide how Wall Street votes.
If you have a 401(k), an IRA, or a pension, there’s a good chance ISS has been voting your money. Most Americans have no idea.
Together, the two firms control roughly 97 percent of that market. Both are foreign-owned. ISS is majority-owned by Deutsche Börse, a German company.
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Florida Attorney General James Uthmeier, who announced a separate action this week, called them “unaccountable foreign-owned private corporations” manipulating shareholder votes “behind closed doors.”
According to the complaint, ISS told investors to vote against corporate board members at companies it believed weren’t doing enough on emissions reductions or racial diversity, while never checking whether any of that was actually good for the people whose money was on the line. ISS also allegedly coordinated its recommendations behind the scenes with climate and DEI activist groups, including Climate Action 100+, Ceres, and The Children’s Investment Fund.
“ISS sold Nebraska investors on the promise of objective, independent research,” Hilgers said in a statement to RedState. “What they were actually getting was advocacy — coordinated with ESG activist organizations, untested against any financial standard, and driven by an ideological agenda that ISS never disclosed. You cannot promise one thing and deliver another in Nebraska.”
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ISS’s own employees apparently had doubts. Internal emails quoted in the complaint show staff questioning whether the firm’s climate and diversity analysis was worth anything.
“I wish we had a better process (and one that didn’t rely so heavily on the opinions of non-experts, frankly),” one employee wrote.
Another internal message stated bluntly:
“ISS ESG data probably isn’t accurate.”
One example highlighted in the lawsuit involved Warren Buffett.
In 2021, ISS told investors to think twice about reelecting Buffett to his own board, citing climate concerns, despite Berkshire Hathaway’s stock rising more than 50 percent over the preceding five years. Nobody at ISS ran any analysis of what a Buffett-led buyout might do to the stock, the complaint alleges.
A senior ISS official acknowledged as much in an internal email:
We’ll probably touch the stove for a moment with our cautionary FOR on Buffett, but it is in line with the other climate risk-driven recs that we’ve made this year.
Nebraska also alleges ISS was running a side business selling consulting services to the very companies it was supposed to be rating, without telling clients.
The complaint calls it “a health inspector selling cleaning services on the side.”
ISS did not respond to a request for comment.
Nebraska isn’t acting alone. Iowa, Texas, and West Virginia filed their own suits the same day, according to an email to RedState. More than a dozen states have banded together under a Multistate Proxy Advisor Coalition.
Uthmeier’s Florida action seeks to fine ISS and Glass Lewis, bar them from continuing their practices, and require them to pay back affected investors.
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They also have the White House behind them. President Trump signed an executive order in December 2025 directing federal regulators to go after the proxy advisory industry, calling out ISS and Glass Lewis for using their influence to “advance and prioritize radical politically-motivated agendas.”
West Virginia Attorney General JB McCuskey didn’t mince words in a statement to RedState.
“ISS has, itself and through its proxies, exerted massive, secretive influence over major portions of our economy, leading to a restructuring of board rooms into political machines designed to destroy coal, gas and many of the values that West Virginians hold dear,” McCuskey said. “That stops today.”
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