JP Morgan Asset & Wealth Management has shifted from external proxy advisers to its proprietary, AI-driven tool, Proxy IQ, for its US stewardship strategies amidst growing political scrutiny of the proxy advisory sector. This new software consolidates and analyses data from over 3,000 annual company meetings, enhancing the independent insights of JP Morgan’s portfolio managers and reducing dependence on third-party data collection. Historically, JP Morgan has utilized prominent proxy advisers like Institutional Shareholder Services and Glass Lewis but has been critical of their substantial influence. This transition follows a recent executive order from the US administration seeking to limit proxy advisers’ sway over ESG and DEI issues, highlighting their control over 90% of the market and calling for investigations by the Securities and Exchange Commission regarding potential voting recommendation fraud. JP Morgan’s move reflects a strategic pivot towards self-sufficiency in stewardship and compliance with evolving regulatory landscapes.
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