What is ISS and Glass Lewis

Two private firms quietly tell a huge share of the world's institutional money how to vote at annual meetings. ISS and Glass Lewis write the research reports, set the voting policies, and in many cases cast the ballots themselves. Together they sit on an estimated 97 percent of the proxy advisory market, a figure cited by the U.S. House Financial Services Committee and academic researchers alike.

The numbers get concrete fast. ISS clients vote on roughly 8.5 million proxy ballots a year. Glass Lewis says its clients manage more than $40 trillion in assets across about 100 markets. That is the scale at which these two firms operate, and it is why every board, compensation committee, and activist pays attention to what they publish each fall.

The Proxy Advisory Duopoly

A proxy advisor is a research firm that reviews the agenda of a shareholder meeting, studies the company, and tells institutional investors how to vote on each item. Most items look dry on paper: reelecting directors, approving auditors, signing off on executive pay. A few are not dry at all. Mergers, contested board seats, shareholder proposals on climate or political spending, and poison pills all pass through the same pipe.

ISS and Glass Lewis dominate that pipe. Both the U.S. House Financial Services Committee and the Wall Street Journal editorial board have cited the 97 percent combined market share figure, echoed by research out of George Mason University. Testimony from the same House hearings used the "more than 90 percent" framing, which is the more defensible floor.

There is a reason only two firms matter. Building the data infrastructure to cover tens of thousands of meetings in a hundred-plus jurisdictions is expensive, and institutional clients prefer consistency across a global book. New entrants exist. None come close on coverage.

Institutional Shareholder Services (ISS)

Origins and Ownership

ISS was founded in 1985 and is headquartered in Rockville, Maryland. Ownership has changed hands more than once. MSCI sold it to Vestar Capital Partners in 2014. Genstar Capital took over later. In 2021, Deutsche Börse Group acquired a majority stake valuing ISS at roughly $2.275 billion, with Genstar and management initially retaining about 20 percent. Following the 2023 merger with STOXX to form ISS STOXX, General Atlantic held the remaining 20 percent minority position. In February 2026, Deutsche Börse agreed to buy out General Atlantic for €1.1 billion, with the exit completing at the end of March 2026. Deutsche Börse is now the sole owner.

Scale and Clients

ISS STOXX reports more than 3,800 professionals across 30 offices in 20 countries, serving roughly 5,500 clients. Those clients include many of the world's largest pension funds, mutual funds, and hedge funds. ISS covers tens of thousands of shareholder meetings globally, and its clients vote on roughly 8.5 million ballots each year.

How ISS Shapes Votes

ISS does not run a single rulebook. It offers a suite of policies clients can subscribe to: a U.S. Benchmark, regional benchmarks, and specialty tracks including Socially Responsible, Sustainability, Climate, Taft-Hartley Labor, and Faith-Based. Clients can also build fully custom policies using the firm's PolicyEngine platform, mixing ISS data with their own rules.

The benchmark policy is the one people argue about. Updated each November and effective for meetings on or after February 1 of the following year, it drives the "ISS Recommends Against" headlines. The 2026 benchmark update pushed the CEO pay-for-performance evaluation window from three years to five, tightened the treatment of unequal voting rights regardless of whether superior shares are labeled common or preferred, and moved four categories of environmental and social shareholder proposals, covering climate, diversity, human rights, and political contributions, to case-by-case analysis instead of a default "For."

Glass Lewis

Origins and Ownership

Glass Lewis was founded in 2003 and is headquartered in San Francisco. Ontario Teachers' Pension Plan acquired the firm in 2007, and AIMCo took a 20 percent stake in 2013. In March 2021, Toronto-based Peloton Capital Management and Canadian financial services entrepreneur Stephen Smith acquired Glass Lewis from the two pension owners. Peloton itself was co-founded by former Ontario Teachers' managing directors, which is how the deal came together.

Scale and Clients

Glass Lewis says it serves more than 1,300 institutional investors and over 2,300 corporate issuer clients, covers roughly 30,000 meetings a year across about 100 markets, and reports that client assets exceed $40 trillion. It operates from San Francisco, Toronto, New York, London, Limerick, Karlsruhe, Paris, Sydney, and Tokyo, among other locations.

The Pivot Away From Benchmark Policy

This is the biggest structural change in the industry in years. On October 14, 2025, Glass Lewis announced it will stop publishing its standard benchmark voting guidelines in 2027. Instead, clients will select from a menu of differentiated voting frameworks that reflect their own stewardship priorities, or build custom policies outright. Glass Lewis already serves most of its clients through custom or thematic policies, so the move formalizes a trend rather than inventing one.

The timing is not accidental. Glass Lewis and ISS were sued by the Texas attorney general over state anti-ESG legislation, and a federal judge issued preliminary injunctions in August 2025 blocking enforcement, with trial set for February 2026. Dropping a single benchmark voice reduces the political target.

The firm still released 2026 benchmark guidelines in early December 2025 for meetings on or after January 1, 2026. Those updates replaced the A to F pay-for-performance letter grade with a 0 to 100 numeric score mapped to five concern levels, extended the evaluation period from three to five years, and added new tests on CEO compensation actually paid versus relative TSR.

How They Actually Influence Outcomes

Say-on-Pay and Director Elections

The influence is measurable. Research cited on the Harvard Law School Forum on Corporate Governance found that an unfavorable ISS recommendation is associated with 13.6 to 20.6 percent fewer affirmative votes on management proposals in the S&P 1500. A Glass Lewis "For" recommendation is associated with roughly 16 percent, 12 percent, and 64 percent increases in institutional support for say-on-pay, equity plans, and proxy contests, respectively.

A separate study by the American Council for Capital Formation found that 175 asset managers controlling more than $5 trillion in assets voted with ISS more than 95 percent of the time. That is what practitioners mean when they say some funds vote "in lockstep."

Pay-for-Performance Models

Executive comp is where the quantitative models bite hardest. Both firms run proprietary screens comparing CEO pay to TSR and financial performance over a multi-year window. For 2026, both extended that window to five years. Glass Lewis layered in new tests using pay-versus-performance table data, including CEO compensation actually paid against relative TSR and short-term incentive payouts against market benchmarks. Fall short on the screens, land in a "Severe" or "High" concern bucket, and a negative say-on-pay recommendation follows unless qualitative factors save it.

Criticism and Regulatory Pressure

The duopoly draws consistent fire. Critics point to the dual-client model at ISS, where the same firm advises investors on how to vote and sells governance consulting to issuers. They argue conflicts are inherent even with internal firewalls. ISS itself paid a $300,000 SEC fine in 2013 for failing to safeguard confidential client proxy voting information.

Jamie Dimon went public in March 2025 with a WSJ op-ed attacking both firms. On January 7, 2026, J.P. Morgan Asset & Wealth Management announced it would cut ties with ISS and Glass Lewis for U.S. proxy voting, moving to an in-house AI platform called Proxy IQ that runs on the firm's Spectrum investment data platform and covers more than 3,000 U.S. company annual meetings. JPMorgan claims it is the first major investment manager to fully drop external proxy advisors for U.S. voting decisions.

Foreign ownership adds a political dimension. ISS STOXX is owned by Deutsche Börse, a German exchange operator. Glass Lewis is owned by a Canadian private equity firm and a Canadian entrepreneur. Congressional critics hammer this point repeatedly. The firms counter that ownership does not drive individual recommendations.

What Companies and Investors Should Watch

The old mental model, where both firms publish one benchmark and companies lobby to stay on the right side of it, is breaking down. Glass Lewis walks away from that model in 2027. Custom and thematic policies are already the default at most large asset managers. Expect voting outcomes to become more fragmented, less predictable, and harder to spin after the fact.

For companies, that means stop treating "the ISS view" and "the Glass Lewis view" as two data points. Engagement has to go wider, directly to the actual investors whose custom policies will decide the vote. For investors, the shift puts more of the burden back in-house. The proxy advisor becomes a research vendor and an execution platform, not a rulebook.

Two firms still dominate the plumbing. What they recommend is about to matter in a very different way.