History
ISS was founded in 1985. [4] [5]
With Disney announcing the combination of the CEO and chairman positions on October 6, 2011, past the date of shareholder proposal deadline, and increase CEO/chair pay, ISS called for a no vote against the four Nominating and Governance Committee board members at the 2012 annual meeting. [6] ISS recommended to clients two candidates nominated by billionaire investor Carl Icahn to the drugmaker Forest Laboratories’ board of directors in a 2012 proxy contest. [7]
In 2013 ISS agreed to pay the SEC a fine of $300,000 and retain an independent compliance consultant to settle charges that it failed to safeguard the confidential proxy voting information of clients. [8] ISS was highlighted in a 2014 opinion piece in the New York Times by Cornell University law professor Lynn Stout as having an outsized power in the selection of CEOs of major corporations in the United States with ramifications for the U.S. economy. [9] It was owned by MSCI until April 30, 2014 when it was purchased by Vestar Capital Partners. [10]
Ethix SRI Advisors was purchased by ISS to help ISS expand into Europe. Ethix was renamed with the acquisition to ISS-Ethix and would lead ISS's sustainable and responsible investment activities. [11] In 2017, ownership of ISS switched to Genstar Capital. [12] In March 2018, ISS also acquired the German ESG rating agency oekom research AG. [13] In November 2020 Deutsche Börse announced the acquisition of a majority in ISS-shares for about 1.5 billion Euro. [14]
Acquisitions
In September 2015, ISS acquired Ethix SRI Advisors, a provider of sustainable and responsible investment (SRI) research and solutions such as corporate engagement, screening, monitoring and assessing companies’ performance. [15]
In January 2017, ISS acquired IW Financial, a U.S.-based firm offering environmental, social, and governance (ESG) research, consulting, and portfolio management solutions. [16]
In June 2017, ISS acquired Climate Neutral Investments (CNI), the Investment Climate Data division of the South Pole Group. [17]
In February 2018, ISS acquired EVA Dimensions, a provider of cash-flow-based analysis of corporate performance. [18]
In March 2018, ISS acquired oekom AG, a provider of environmental, social, and governance (ESG) ratings and data. [19]
In February 2019, ISS acquired CAER, a Canberra-based research company that has worked with institutional investors seeking to monitor portfolio companies’ ESG policies, practices, and disclosures since 2000. [20]
In October 2020, ISS acquired FICO® Cyber Risk Score Business, which helps organizations in their efforts to measure, manage and reduce cyber risk. [21]
In February 2021, ISS acquired ACRe Data, a provider of ESG Scoring for the U.S. Municipal marketplace. [22]
Carl Celian Icahn is an American businessman, investor, and philanthropist. He is the founder and controlling shareholder of Icahn Enterprises, a public company and diversified conglomerate holding company based in Sunny Isles Beach, Florida. Icahn's business model is to take large stakes in companies that he believes will appreciate from changes to corporate policy. Subsequently, Icahn then pressures management to make the changes that he believes will benefit shareholders, and him. Widely regarded as one of the most successful hedge fund managers of all time and one of the greatest investors on Wall Street, he was one of the first activist shareholders and is credited with making that investment strategy mainstream for hedge funds.
Euronext N.V. is a pan-European bourse that provides trading and post-trade services for a range of financial instruments.
Shareholder activism is a form of activism in which shareholders use equity stakes in a corporation to put pressure on its management. A fairly small stake may be enough to launch a successful campaign. In comparison, a full takeover bid is a much more costly and difficult undertaking. The goals of shareholder activism range from financial to non-financial. Shareholder activists can address self-dealing by corporate insiders, although large stockholders can also engage in self-dealing to themselves at the expense of smaller minority shareholders.
Morningstar, Inc. is an American financial services firm headquartered in Chicago, Illinois, and was founded by Joe Mansueto in 1984. It provides an array of investment research and investment management services.
Deutsche Börse AG, or the Deutsche Börse Group, is a German multinational that offers a marketplace for organizing the trading of shares and other securities. It is also a transaction services provider, giving companies and investors access to global capital markets. It is a joint stock company and was founded in 1992, with headquarters in Frankfurt. On 1 October 2014, Deutsche Börse AG became the 14th announced member of the United Nations Sustainable Stock Exchanges initiative.
BlackRock, Inc. is an American multinational investment company. It is the world's largest asset manager, with $10 trillion in assets under management as of December 31, 2023. Headquartered in New York City, Blackrock has 78 offices in 38 countries, and clients in 100 countries. BlackRock is the manager of the iShares group of exchange-traded funds, and along with The Vanguard Group and State Street, it is considered to be one of the Big Three index fund managers. Its Aladdin software keeps track of investment portfolios for many major financial institutions and its BlackRock Solutions division provides financial risk management services. The head of Aladdin is Sudhir Nair. As of 2023, BlackRock was ranked 229th on the Fortune 500 list of the largest United States corporations by revenue.
MSCI Inc. is an American finance company headquartered in New York City. MSCI is a global provider of equity, fixed income, real estate indices, multi-asset portfolio analysis tools, ESG and climate products. It operates the MSCI World, MSCI All Country World Index (ACWI) and MSCI Emerging Markets Indices among others.
Socially responsible investing (SRI) is any investment strategy which seeks to consider both financial return and social/environmental good. The areas of concern recognized by the SRI practitioners are sometimes summarized under the heading of environmental, social and governance (ESG) issues: environment, social, and corporate governance. Impact investing is subset of SRI that is generally more proactive and focused on the conscious creation of social impact through investment. Eco-investing is SRI with a focus on environmentalism.
A proxy firm provides services to shareholders to vote their shares at shareholder meetings of, usually, listed companies.
Vestar Capital Partners is an American private equity firm focusing on leveraged buyout transactions in middle-market companies in the United States.
Glass, Lewis & Co. is a major American proxy advisory services company. As of spring 2019, Glass Lewis controlled 28% of the proxy advisory market for mutual funds; this makes it the second-largest company in the market behind Institutional Shareholder Services. The primary services provided by Glass Lewis are research and recommendations for shareholder votes by institutional investors, including a digital platform for managing these votes and reporting. A large fraction of those investors follow the recommendations of Glass Lewis in lockstep, giving it outsize importance and impact on governance across the corporate sphere.
Environmental, social, and governance (ESG), is a set of aspects, including environmental issues, social issues and corporate governance that can be considered in investing. Investing with ESG considerations is sometimes referred to as responsible investing or, in more proactive cases, impact investing.
Broadridge Financial Solutions, Inc. is a public corporate services and financial technology company founded in 2007 as a spin-off from management software company Automatic Data Processing. Broadridge supplies public companies with proxy statements, annual reports and other financial documents, and shareholder communications solutions, such as virtual annual meetings.
Confluence is a software firm that provides back-office automation systems to the investment management industry. The company was founded in 1991, and aims to lead the "DataTech evolution" with "a vision ... [of] instantaneously transforming data into knowledge and delivering it to the world." According to the company's website, Confluence technology is in use by eight of the top 10 global service providers, and all of the top 10 global asset managers have business processes automated through Confluence.
Numerix is an American financial technology limited liability company. It is headquartered in New York City with nineteen offices worldwide.
Solactive is a German-based company specializing in the provision of financial indices established in 2007. The company is headquartered in Frankfurt, Germany, but also maintains offices in Berlin and Dresden. Since 2017, Solactive has expanded its global presence with offices in Toronto, Hong Kong, and Amsterdam.
Diligent Corporation, known as Diligent, is a software as a service company that enables groups to share and collaborate information for board meetings. Headquartered in New York City, and incorporated in Delaware, the company has offices in Galway, Ireland; London, UK; Washington, D.C.; Munich, Germany; Budapest, Hungary; Hong Kong; Bangalore, India; Sydney and Vancouver.
Sustainalytics is a company that rates the sustainability of listed companies based on their environmental, social and corporate governance (ESG) performance. The company was born of a merger between Toronto-based Jantzi Research, which was founded in 1992 by Sustainalytics' current CEO Michael Jantzi, and its European counterpart. Following its acquisition of GES International on January 9, 2019, Sustainalytics had more than 600 employees with offices in 17 cities around the world and over 700 institutional investor clients. On April 21, 2020, Morningstar, Inc. acquired the remaining ~60% of Sustainalytics' shares to become the sole owner.
MarketAxess Holdings Inc. (MarketAxess) is an international financial technology company that operates an electronic trading platform for the institutional credit markets, and also provides market data and post-trade services. It enables institutional investors and broker-dealers to trade credit instruments, including corporate bonds, and other types of fixed income products.
Acrisure is a financial technology and insurance company headquartered in Grand Rapids, Michigan. The company was initially created to acquire insurance companies in the Midwestern United States and has since expanded nationally. In 2022, Business Insurance recognized Acrisure as the 6th largest insurance broker in the world.
