Proxy Services Wage Proxy War

Proxy battles tend to get settled -- well, by proxy. More to the point, that is, by the proxy services that recommend how shareholders should vote on contentious issues. Since many large institutional investors simply vote their shares in line with proxy-service recommendations, big proxy operators like RiskMetrics/ISS can wield disproportionate influence.

Which is why it's fascinating to see Proxy Governance -- last mentioned around these parts for its role advising Yahoo shareholders to oust three members of the board -- take on ISS and accuse it of abusing its "monopolistic power." Its main complaint: ISS is conflicted because it sells consulting services to the same companies whose proxy materials ISS evaluates. Peter Galuszka has the details over at his BNET blog The Corner Office.
(FYI, RiskMetrics/ISS took the opposite position in the Yahoo vote, and recommended supporting the existing board.)