U.S. Markets

Proxy advisory firm Glass Lewis CEO Rabin to step down: sources

(Reuters) - Katherine “KT” Rabin is stepping down as CEO of Glass Lewis & Co, after spending more than a decade at the helm of the influential proxy advisory firm that shapes the outcome of major corporate ballots, according to people familiar with the matter.

Rabin’s departure comes as Glass Lewis faces increasing competition from rival Institutional Shareholder Services Inc (ISS), as well as heightened regulatory oversight by the U.S. Securities and Exchange Commission (SEC).

The sources did not disclose the reason for Rabin’s departure. They asked not to be identified ahead of an official announcement. Rabin and a spokesman for Glass Lewis did not respond to requests for comment.

Glass Lewis advises shareholders on how to vote on corporate governance issues such as pay, deals and directors. The San Francisco-based firm distributes its research to more than 1,300 institutional clients, including the bulk of the world’s biggest pension plans and asset managers.

Rabin joined Glass Lewis in 2003, shortly after the firm was founded, and has served as its chief executive for the last 12 years. During her tenure, Glass Lewis grew as the proxy advisory industry’s second largest player after ISS, guiding how shareholder votes representing trillions of dollars worth of shares are cast.

However unlike ISS, Glass Lewis did not expand in areas such as consulting services for investors.

Before joining Glass Lewis, Rabin was vice president of communications at supply chain management company QRS Corp, where she helped create its investor relations program.

Canadian pension fund Ontario Teachers’ Pension Plan spent $46 million to buy Glass Lewis from Xinhua Finance in 2007. In 2013, another Canadian pension fund, Alberta Investment Management Corp, bought a 20% stake in Glass Lewis from Ontario Teachers’ for an undisclosed sum.

Last month, the SEC issued new guidance that aims to clarify how investors and advisory firms that cast ballots on their behalf should vote in corporate elections on issues like pay and diversity.

The guidance, which expands previous 2014 guidance on shareholder voting in corporate ballots, addresses some of the grievances U.S. corporations have long had about so-called proxy advisers, such as mistakes in reports the advisers issue on specific companies and conflicts of interest in their business models.

Reporting by Svea Herbst-Bayliss in Boston; Editing by Subhranshu Sahu