McRae: A problem for every household
By Treasurer David McRae
Glass Lewis and ISS – these are hardly household names, but the work they do affects nearly every home in the nation. Together, these two firms make up about 97 percent of the proxy advisory market. Unfamiliar with what the proxy advisory market is? You aren’t alone. Proxy advisory firms guide investors as to how they should vote at corporate shareholder meetings. I know this is all getting a bit wonky, but stick with me for a moment.
While these firms’ codes of ethics forbid analysts from making recommendations based on their personal, social, or political preferences, they have recently been used as pawns by liberals to challenge companies on a wide range of issues – from an organization’s impact on the climate to their decisions related to LGBTQ+ and gender diversity. In an alarmingly vast number of cases, the recommendations made favor woke policies over conservative values.
Think about this: For most of the recent year for which data is available (2022), Glass Lewis supported approximately 53 percent of social shareholder proposals and 60 percent of environmental shareholder proposals. Zero percent of shareholder proposals brought forward by conservative groups were supported.
As a conservative, this is concerning to say the least. Through these proxy advisory firms, the woke left is able to silence conservative voices and restrict investments into organizations that celebrate conservative values.
It’s also quite concerning as your State Treasurer. In this role, I am responsible for making sure any investments made by the state are as profitable as possible. This helps ensure the stability of the state’s pension system, alleviates pressure on taxpayers, and keeps the state budget in check. If a political agenda (rather than profitability) is driving shareholder discussions, then your pension and our state budget is put in jeopardy.
This fall, I joined a dozen state financial officers on letters to Glass Lewis and ISS. In the letters, we sought accountability for the favoritism shown to left-leaning initiatives.
Of course, this letter is just the latest in my fight against the ESG (Environmental, Social, and Governance) movement. I have also worked to hold companies like BlackRock accountable for putting Wall Street agendas ahead of Main Street values. I’ve battled to build a coalition of conservative state financial officers who together will have outsized buying power and can therefore act as a proper counterweight to liberal states, like California and New York. And I’ve tried to raise awareness about how this wonky policy issue affects your savings, retirement, and tax bill.
I will continue to work on this in the weeks and months ahead, offering you updates as progress is made. If you are looking to learn more, please visit the Newsroom on my website, treasury.ms.gov.
Mississippi Treasurer David McRae is the 55th Treasurer for the State of Mississippi. In this role, he helps manage the state’s cash flow, oversees College Savings Mississippi, and has returned nearly $75 million in unclaimed money to Mississippians. For more information, visit Treasury.MS.gov.
