Exclusive-Proxy adviser ISS expands offerings for 'ESG skeptic' clients

investing.com:

By Ross Kerber

(Reuters) — Institutional Shareholder Services (ISS), the influential proxy adviser majority owned by Deutsche Boerse (ETR:DB1Gn) that recommends how shareholders should vote in corporate elections, will offer a new «ESG skeptic» option, according to executives.

The new offering is «in keeping with our longstanding mission to provide a wide array of voting policy choices,» ISS global head of investment stewardship Lorraine Kelly said in a statement.

A strong reception for the guidelines could dampen criticism of ISS from U.S. Republican politicians, who have said the Maryland-based firm backs too many shareholder resolutions on environmental, social or governance (ESG) topics.

ISS currently offers seven types of specialty voting guidelines, beyond its benchmark guidelines, for investors like climate-focused groups or religious funds. ISS last year added «board-aligned» investment voting guidelines that opposed many ESG resolutions, though the new offering may appeal to clients who want to go further against ESG.

Kelly said the firm is making available the new guidelines in partnership with Bowyer Research, a fund consulting business based near Pittsburgh, for the upcoming shareholder meeting season.

ISS will initially make Bowyer's research available only to public pension plans, according to firm principal Jerry Bowyer.

Bowyer said he calls his approach that of an «ESG skeptic» and that he supports ESG resolutions less than 5% of the time, compared to about 50% for the ISS benchmark guidelines. Bowyer said he and ISS executives started speaking after he criticized ISS on social media site LinkedIn in June 2023, discussions that led to the collaboration.

«This is an effort at de-politicization. This isn't