Rep. Bryan Steil, R-Wis., introduced a bill Friday that aims to restore proxy-voting reforms the SEC overturned in July, which he said has bolstered proxy advisers' influence over corporate governance.
"My bill puts a stop to the Left's woke attack on American capitalism," Mr. Steil said in a press release. "Americans are already seeing their retirement savings shrink because of Washington's reckless spending. We need to empower investors, restore transparency and accountability, and enhance competition."
In July, the Securities and Exchange Commission voted to rescind two Trump-era amendments to its rules concerning proxy-voting advice. The amendments, originally adopted in 2020, require companies that are the subject of voting advice to have access to that advice prior to or at the same time it's disseminated to clients, and require proxy-advisory firms to give clients access to any response the company provides on voting advice before clients vote.
Mr. Steil's proposed legislation, among other provisions, requires proxy advisory firms to register with the SEC; obligates any pension fund, asset manager or investment adviser using a proxy advisory firm to report a host of voting information to their customers or beneficiaries; and demands increased disclosure on annual returns and fees charged to investors from any broad-based fund advertising itself as an ESG fund.
Republican lawmakers who co-sponsored the bill said they are concerned that proxy advisory firms are pushing their beliefs on institutional investors.
"Leveraging the retirement funds of every day Wisconsinites to advance a particular cause is not only inappropriate but financially harmful," Rep. Scott Fitzgerald, R-Wis., said in the press release. "Proxy advisers, who represent shareholders of all stripes, must not be able to abuse their responsibility by doing the work of activists."
Rep. Andy Barr, R-Ky., said in the press release that "proxy advisory firms are uniquely complicit in the woke environmental, social, and governance agenda that is poisoning our capital marks."
Mr. Barr introduced a bill in the House earlier this month, along with Rep. Bill Huizenga, R-Mich., that aims to block the SEC's climate disclosure rule, which would require public companies to disclose an array of climate-related information in their registration statements and periodic reports.