U.S. capital markets are the world’s envy. Gary Gensler’s job as chairman of the Securities and Exchange Commission is to protect and promote them. Instead he’s attacking them.
After first refusing to enforce Trump-era regulations on proxy-advisory firms, which advise institutional investors how to vote on shareholder proposals, the SEC voted 3-2 last Wednesday to roll them back. Glass Lewis and Institutional Shareholder Services dominate the market in the U.S., and the now-rescinded regulations sought to constrain their corporate-governance duopoly by subjecting them to challenge from public companies, which will continue to lack recourse against proxy advisers that push political priorities at the expense of shareholder returns.