JPMorgan Shifts U.S. Proxy Voting In-House with New AI Platform

JPMorgan’s asset management arm has decided to discontinue the use of third-party proxy advisory firms for voting on U.S. companies, replacing them with a newly developed internal, AI-driven system. According to an internal company memo cited by ESG Today, the move positions the firm as the first major global investment manager to fully step away from external proxy advisors in the U.S. market.

 

Building an Internal Alternative to Proxy Advisors

 

J.P. Morgan Asset & Wealth Management, which oversees more than $4.5 trillion in assets under management, will now rely on Proxy IQ, an AI-powered platform launched within its Spectrum investment data infrastructure. The system is designed to manage the full proxy voting process for U.S. equities.

Proxy IQ aggregates and analyzes proprietary information from more than 3,000 company annual meetings. By centralizing data collection and analysis internally, JPMorgan aims to eliminate dependence on third-party research, recommendations, and voting guidance traditionally supplied by external firms.

 

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A Market Long Dominated by Two Players

 

The proxy advisory market has historically been concentrated in the hands of two firms, Glass Lewis and Institutional Shareholder Services, which together account for more than 90 percent of the sector. JPMorgan’s decision marks a significant departure from industry norms and could signal broader changes in how large asset managers approach proxy voting and stewardship.

 

Regulatory and Political Pressure in the Background

 

The shift comes amid heightened scrutiny of proxy advisory firms in the United States. In December, Donald Trump issued an executive order instructing federal agencies to increase oversight of proxy advisors, citing concerns related to antitrust behavior, unfair competition, and alleged politicization of voting recommendations. The order specifically criticized the firms’ influence on ESG and diversity-related shareholder proposals.

That directive followed legal actions and investigations initiated by several U.S. states, as well as comments from SEC Chair Paul Atkins, who has warned about what he described as the “weaponization” of shareholder proposals by activist investors. Together, these developments have placed proxy advisors under sustained regulatory and political pressure.

 

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Industry Adjustments Already Underway

 

Against this backdrop, Glass Lewis has recently announced changes to how it delivers research and voting guidance. The firm said it will move away from issuing singular voting recommendations, pointing to growing divergence among investors in the U.S. and Europe on sustainability, governance, and corporate engagement issues.

JPMorgan’s move to an internal, AI-enabled platform reflects both technological capability and a strategic response to this shifting landscape. By controlling proxy voting analysis in-house, the firm reduces regulatory exposure, gains greater flexibility in stewardship decisions, and sets a precedent that could influence how other large asset managers rethink their reliance on external proxy advisors.