State of Nebraska ex rel. Hilgers v. Institutional Shareholder Services, Inc.

On May 20, 2026, the attorneys general of Iowa, Nebraska, Texas, and West Virginia each filed a lawsuit in state trial courts against the proxy adviser Institutional Shareholder Services, Inc. (ISS) alleging that ISS violated state deceptive trade practice and consumer protection laws by failing to disclose how environmental, social, and governance (ESG) considerations affected ISS’s advice to its shareholder clients. Florida previously filed a similar suit against ISS and Glass, Lewis & Co. LLC. Nebraska’s complaint asserted violations of the State’s Uniform Deceptive Trade Practices Act and Consumer Protection Act, alleging that ISS provided advice “tainted” by its own “ESG ideological considerations untethered to its clients’ best financial interests and prepared in close coordination with ESG activists” such as Climate Action 100+, Ceres, The Children’s Investment Fund, and As You Sow. Nebraska also alleged that ISS misled shareholder clients through illegal consideration of race and ethnicity with respect to board of director candidates, through a “privately admitted lack of competence underlying certain of its ESG recommendations,” and due to “conflicts of interest related to running a parallel ESG consulting business.” Nebraska sought declaratory and injunctive relief, civil penalties, restitution, and costs and fees.

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