On August 21, 2019, the Securities and Exchange Commission, in a 3-to-2 vote (along party lines), approved new guidance for investment advisers (such as fund managers) relating to their responsibilities in voting their clients’ shares by proxy and relying on proxy advisory firms (such as ISS and Glass Lewis) for voting recommendations. The new guidance comes against a backdrop of increasing debate in recent years within the corporate community about the expanded use, influence and power of proxy advisory firms. Many issuers have taken the position that the proxy advisory firms have implicit conflicts of interest, generally take a one-size-fits-all approach to their voting policies, do not obtain sufficient input from the issuer when making voting recommendations, and do not have effective processes for identifying or correcting errors in the data they use to make their determinations. However, many investment advisers, who are the actual customers of the proxy advisory firms, have believed that the proxy advisory firms perform their services reasonably well. Because the new guidance was published without a notice and comment period, it becomes effective immediately upon its publication in the Federal Register.