WASHINGTON, D.C. — Few Americans realize how much power is exercised over their retirement savings by companies they have never heard of, but President Donald Trump is betting that revelation will change the national conversation about who really controls corporate America.
On Thursday, President Trump signed a sweeping executive order aimed at curbing the influence of foreign-owned proxy advisory firms that play an outsized role in how shares are voted at the nation’s largest publicly traded companies. The order takes direct aim at Institutional Shareholder Services and Glass Lewis, two firms that together control more than 90 percent of the proxy advisor market and routinely guide voting decisions tied to trillions of dollars in U.S. assets, including 401(k)s, IRAs, and pension funds.
Proxy advisors operate behind the scenes, advising institutional investors how to vote on shareholder proposals, board elections, executive pay packages, and corporate policies. Because many investment managers follow those recommendations with little independent review, the firms wield enormous leverage over corporate governance and, by extension, the financial futures of millions of American workers and retirees.
The White House argues that this power has increasingly been used to advance politically motivated agendas rather than maximize investor returns. According to the executive order and an accompanying fact sheet, the administration contends that proxy advisors have promoted policies tied to diversity, equity, and inclusion initiatives and environmental, social, and governance standards that may conflict with their fiduciary obligation to prioritize financial performance.
Under the order, the chairman of the Securities and Exchange Commission is directed to review and potentially revise or rescind existing rules governing proxy advisors and shareholder proposals. The SEC is also instructed to enforce anti-fraud provisions related to proxy voting recommendations, consider whether proxy advisors should be registered as investment advisers, and examine whether reliance on non-pecuniary factors such as DEI and ESG is consistent with fiduciary duties owed to investors.
The executive order goes further by pulling in the Federal Trade Commission and the Department of Justice. The FTC, in consultation with the attorney general, is tasked with reviewing ongoing state antitrust investigations and determining whether proxy advisors have engaged in unfair competition, deceptive practices, or coordination that diminishes the value of consumer investments. The administration says conflicts of interest, limited transparency, and standardized voting policies have weakened trust in an industry that quietly shapes corporate decision-making.
Retirement security sits at the center of the administration’s case. The Department of Labor is directed to strengthen fiduciary standards under ERISA, revisiting whether proxy advisors should be treated as investment advice fiduciaries when they influence how retirement plan assets are voted. The order calls for enhanced transparency so workers and retirees can better understand how their savings are being used and whether those decisions truly serve their financial interests.
In a fact sheet released by the White House, the administration framed the move as a direct response to concerns that Americans’ retirement dollars have been leveraged to pressure companies into adopting ideological positions unrelated to shareholder value. President Trump reiterated a campaign promise to keep politics out of retirement accounts, arguing that investment decisions should be made to benefit workers, not advance political causes.
The action also fits within a broader economic narrative advanced by the administration. The White House tied the order to tax cuts, deregulation, and policies designed to expand investment options for retirement savers, including allowing 401(k) plans greater access to alternative assets. Officials argue that restoring market discipline and accountability among proxy advisors will strengthen confidence in capital markets and protect long-term wealth building.
The executive order does not immediately rewrite regulations, but it sets the stage for an aggressive review across multiple federal agencies. Its implications could ripple through Wall Street, corporate boardrooms, and the retirement plans of millions of Americans, reigniting debate over the balance between shareholder activism, fiduciary duty, and political influence in financial markets.
At its core, the order challenges a system that has operated largely out of public view. Whether it results in tighter oversight, increased competition, or legal challenges from the proxy advisory industry, the move signals that proxy voting — once considered a technical backwater of finance — has become a front-line issue in the battle over who controls American capital and for what purpose.
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