The Securities and Exchange Commission has escalated its standoff with Institutional Shareholder Services, filing a subpoena enforcement action in the Eastern District of Pennsylvania on September 4, 2026. The move comes after ISS refused to fully comply with an administrative subpoena issued on July 21, 2026, as part of a broader examination that kicked off in March.
The SEC wants a federal court to force ISS to hand over core operational documents, including its proxy voting recommendations, internal methodologies, and compliance records. ISS has pushed back, arguing that full compliance could violate its First Amendment rights and expose both the firm and its clients to retaliation over sensitive corporate voting matters.
What the SEC is after
ISS isn’t some niche consultancy. Along with its main competitor Glass Lewis, the firm controls roughly 90% of the proxy advisory market. That means when ISS issues a recommendation on how shareholders should vote on executive pay, board members, or mergers, the ripple effects touch trillions of dollars in institutional assets.
The SEC’s investigation is focused on whether ISS has been operating in compliance with federal securities laws in its capacity as a registered investment adviser. The subpoena specifically targets the methodology behind its voting recommendations, the kind of proprietary information that proxy advisory firms guard closely.
