Key facts
- The DOJ plans to rescind a 1987 guidance letter on proxy advisors.
- Adam Candeub, Trump's nominee for DOJ antitrust chief, faced Senate grilling.
- Candeub was questioned about past statements on Muslim immigrants and political speech.
- The DOJ's planned action increases scrutiny on proxy advisory firms ISS and Glass Lewis.
- These firms advise institutional investors on corporate voting decisions.
The U.S. Department of Justice intends to withdraw a 1987 guidance letter that previously stated proxy advisor Institutional Shareholder Services' business model did not raise antitrust concerns. This move signals increased scrutiny of the industry, which includes firms like ISS and Glass, Lewis & Co that advise institutional investors on corporate voting decisions.
President Donald Trump has previously advocated for an antitrust probe into these proxy advisory firms, which together hold a dominant market share. A report from the Heritage Foundation has also argued for a DOJ or FTC investigation into the duopoly. The House Judiciary Committee has similarly expressed antitrust concerns regarding the firms' market control.
During his Senate confirmation hearing, Adam Candeub, Trump's nominee to lead the DOJ's antitrust division, was questioned by senators. Democratic senators focused on Candeub's past writings, including a statement calling Muslim immigrants 'prone to terrorism.' Candeub defended the remarks as being in defense of Trump's travel ban. Republican Senator John Kennedy also questioned Candeub regarding the FCC's actions concerning political speech and the agency's authority over broadcasters.