Nebraska Attorney General Sues Proxy Advisory Firm Over ESG and DEI Advice

Nebraska Attorney General Mike Hilgers filed a lawsuit Wednesday against proxy advisory firm Institutional Shareholder Services. The complaint alleges the firm violated its fiduciary duty by incorporating environmental, social, and governance factors and diversity, equity, and inclusion policies into its recommendations.

The suit states that ISS promised objective research to Nebraska investors but instead delivered advice coordinated with ESG activist organizations. It further claims the firm operates a parallel ESG consulting business while issuing research reports on the same companies.

The complaint accuses ISS of recommending shareholder votes against boards lacking gender diversity and of grading companies on climate and diversity metrics without corresponding financial analysis. It argues these practices placed investment returns behind the promotion of social and political goals.

The filing also alleges racial discrimination through consideration of race and ethnicity in board candidate recommendations. Nebraska residents with pensions and investment accounts are identified as affected parties.

Uthmeier filed a similar lawsuit against ISS and Glass Lewis in November 2025. That suit alleges violations of fiduciary duty and state antitrust laws. Both firms are foreign-owned. A coalition of 15 states now participates in multistate efforts regarding proxy advisor practices. ISS and Glass Lewis have denied the claims made in the Florida case.