Wells Fargo Launches Proprietary Proxy Voting System Reducing Adviser Dependence

Wells Fargo Wealth and Investment Management, which manages USD 2.5 trillion in client assets, has launched a new proprietary in-house proxy voting system, reducing reliance on external proxy advisory firms that have come under regulatory and political scrutiny for their support of ESG and DEI shareholder resolutions. The move makes Wells Fargo the second major US asset manager to build internal proxy voting infrastructure.

Under the new system, Wells Fargo will direct proxy voting for client assets where it has both investment discretion and voting authority based on its own custom policy focused on clients' long-term economic interests. According to Wells Fargo, this approach brings increased independence and reduces reliance on third parties. The firm has also expanded its relationship with fintech solutions provider Broadridge, which will provide the technology platform to support administration and vote processing for the proprietary voting service.

The proxy advisory market is largely dominated by Glass Lewis and Institutional Shareholder Services, which together account for more than 90% of the market. In December, President Trump signed an executive order directing federal agencies to increase oversight of proxy advisory firms and investigate them for alleged antitrust violations, citing their alleged support for "radical politically-motivated agendas" focused on ESG and DEI. Trump's order followed lawsuits from Florida and Texas and SEC Chair Paul Atkins' plans to examine proxy voting firms for their support of ESG initiatives.

Earlier in the year, JPMorgan announced it would no longer use third-party proxy advisory firms for US company voting, launching an AI-powered platform to handle its US voting processes. Reports indicate that Wells Fargo has also cut ties with ISS. The move reflects a broader reconfiguration of ESG shareholder engagement practices among major US asset managers in response to political and regulatory pressure, with implications for the future trajectory of climate and governance-related shareholder resolutions at listed companies.

Key figure — USD 2.5 trillion