June 25 (Reuters) - The Chamber of Commerce, a leading corporate lobbying group, extended its campaign against Glass, Lewis & Co. on Monday, asking the U.S. Department of Labor for a review of the proxy adviser’s recent behavior.
Similar to a complaint it lodged with the Securities and Exchange Commission last month, the Chamber asked the Labor Department to investigate whether Glass, Lewis had a conflict of interest when it urged opposing the election of some directors to the board of Canadian Pacific Railway.
The complaint comes amid a heated proxy season that has seen shareholders deal surprise defeats to management, often at the urging of Glass, Lewis or its larger rival ISS, at companies ranging from Citigroup to Nabors Industries to Chesapeake Energy. In reaction, Glass, Lewis and ISS, which is owned by MSCI, have come under increasing fire from business groups.
San Francisco-based Glass Lewis is owned by the $117 billion Ontario Teachers Pension Plan, which owned shares of Canadian Pacific and had backed its own dissident slate of directors in a bid to oust the railway’s board, the Chamber noted in a letter to the Labor Department.
“The fact that the owner’s interests were made known to the public just prior to publication of the subsidiary’s vote recommendation gives the appearance that Ontario’s own unique interests are being deliberately reflected in Glass Lewis’ vote recommendations, and that the mutual positions are being coordinated in some manner,” Tom Quaadman, vice president at the Chamber’s Center for Capital Markets, wrote in the complaint to the Labor Department.
The department is charged with overseeing pension plans and other employee benefits programs to ensure they are managed appropriately.
Quaadman wrote a similar letter complaining about the potential conflict of interest to the SEC on May 31.
Glass, Lewis and the Ontario fund have both denied any wrongdoing in the past. Neither could be reached for immediate comment on the Chamber’s latest complaint.