SEC Proxy Firm Rule Changes Violate Law, Fifth Circuit Says (2)

A federal appeals court has thrown out a major part of the SEC’s reversal of Trump-era restraints on ISS, Glass Lewis and other firms guiding shareholder voting at companies’ annual meetings.

The Securities and Exchange Commission violated agency procedure law when it undid “notice-and-awareness conditions” in the 2020 rules for proxy advisory firms, the US Court of Appeals for the Fifth Circuit ruled on Wednesday.

The SEC under the leadership of Trump appointee Jay Clayton in 2020 ordered proxy firms to provide their voting advice to their clients and companies at the same time. The agency also directed the ...