The U.S. financial markets have long been the bedrock of American capitalism, built on the principle that shareholders—those with real financial stakes—determine corporate governance. However, a sophisticated and well-funded network of left-wing activists, foreign interests, and government bureaucrats have hijacked this system, using proxy advisory firms to impose their radical social and environmental agenda on American businesses. This is not just an attack on corporations; it is an attack on everyday investors, American energy independence, and the very foundations of our free-market economy.
For years, two proxy advisory firms—Institutional Shareholder Services (ISS) and Glass Lewis—have wielded outsized influence over how U.S. companies are run. These firms, both foreign-owned, have been empowered by the Biden administration and former Securities and Exchange Commission Chairman Gary Gensler’s rulemaking to enforce European-style corporate governance in America. Their influence is amplified by a network of activist investors—many foreign-funded—who acquire minuscule stakes in public companies to push far-left policies onto corporate proxies.
Groups like Arjuna Capital, Green Century, and As You Sow—most based in Boston and San Francisco—purchase less than 0.1% of a company’s shares but use this fractional ownership to submit shareholder resolutions that demand adherence to radical environmental, social, and governance (ESG) standards. These groups are backed by an intricate web of left-wing funding sources, including the Tides Foundation, George Soros, the Rockefeller Brothers Fund, Laurene Powell Jobs, and Reed Hastings. They are also heavily supported by public pension funds in deep-blue states, ensuring a steady flow of capital to advance their agenda.
It’s not just small activist investors and proxy advisors driving this agenda—major institutional investors like BlackRock and State Street have become key enablers. These massive asset managers, which oversee trillions of dollars in retirement savings and pension funds, use their voting power to support ESG proposals that undermine American energy independence, promote divisive DEI (Diversity, Equity, and Inclusion) initiatives, and weaken corporate accountability to real shareholders.
The result? Corporations are being pressured to adopt policies that do not serve their shareholders but instead align with the ideological goals of a powerful financial and liberal elite. For example, under ESG pressure, major oil and gas companies like Shell and BP committed to aggressive net-zero goals that impacted their profitability and shareholder returns.
As then-Senator JD Vance (R-OH) told Breitbart News in 2023: “ESG is basically a massive racket to enrich Wall Street and enrich the financial sector of the country, at the expense of industries that actually employ a lot of Ohio’s workers for middle-class jobs.”
Beyond reshaping corporate America, this system also serves as a funding and legal warfare mechanism for the Left. The legal industry, NGOs, and consulting firms that push ESG policies profit enormously from corporate compliance costs, legal fees, and government contracts. These same entities are behind many of the lawsuits aimed at derailing conservative policies and have been instrumental in the lawfare campaigns against President Donald Trump and his Administration.
Recognizing the danger of this proxy advisory cartel, 19 Republican state attorneys general have launched antitrust investigations into ISS, Glass Lewis, and their activist allies. The House Oversight and Judiciary Committees both launched investigations. However, these investigations have been met with fierce legal resistance, as well-funded progressive groups use the courts to stall progress. To truly dismantle this system, a more aggressive and coordinated federal response by President Trump and the Republican Congress is necessary.
The Trump administration should take immediate and decisive action to strip power from the proxy advisory cartel and restore shareholder rights. This requires a multi-pronged approach including an Executive Order to protect investors by repealing all Biden-era corporate governance rules that empowered proxy advisors and activist shareholders and terminating all their federal contracts and agreements.
Attorney General Pam Bondi take should the ongoing State-level investigations into the Department of Justice’s Antitrust Division, ensuring the full force of federal law is used to break up the proxy advisory duopoly. Additionally, the SEC should implement strict rules preventing proxy advisors from making recommendations based on social or environmental factors rather than financial performance.
Finally, Congress should pass Rep. Bryan Steil’s (R-WI) corporate governance reform bill to ensure real shareholders—not a cabal of activist groups—control corporate decision-making. This legislation would, among other things, raise the ownership threshold for submitting shareholder proposals, ensuring only those with significant financial stakes have a say in corporate governance.
The Trump Administration has a golden opportunity to take swift and bold action to dismantle this unholy alliance of foreign interests, activist investors, and government bureaucrats to restore true shareholder rights, and protect the free-market economy from ideological capture. The American people—not unelected activists and bureaucrats—should decide the future of our businesses and our economy.
Cesar Conda, a former Chief of Staff to former Sen. Marco Rubio (R-FL) and a former Assistant to the Vice President for Domestic Policy, is a Principal at Navigators Global LLC and an economic advisory council member of the Committee to Unleash Prosperity.
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