Nunn Bill to Defend Iowans’ Retirement Savings Passes Financial Services Committee

WASHINGTON, D.C. - The House Financial Services Committee today advanced Congressman Zach Nunn's (IA-03) Protecting Americans' Savings Act , legislation to ban the practice of "robovoting" and strengthen safeguards for Americans' retirement savings.

"Iowa workers and retirees invest their hard-earned paychecks into 401(k)s and pensions with the expectation that their savings will be managed in their best interests," said Rep. Nunn . "Our bill ensures those entrusted with managing Iowans' retirement funds aren't rubber-stamping investment decisions made by outside firms without review. Iowans who spent a lifetime saving deserve to know their money is being managed for their financial security - not driven by someone else's political agenda."

Currently, just two companies make recommendations on 97% of shareholder voting in the United States. Many investment managers rely on these recommendations without conducting an independent review, automatically casting proxy votes on behalf of retirement savers through a practice called "robovoting."

The Protecting Americans' Savings Act establishes clear standards requiring institutional investors to independently evaluate proxy recommendations before casting votes. Specifically, the bill:

• Prohibits robovoting by banning automatic voting based solely on proxy advisory firm recommendations.
• Restricts outsourcing of voting authority to third parties that do not have a fiduciary duty to the investor.
• Ensures no investor or firm is required to cast a proxy vote unless obligated by fiduciary responsibility.

"For too long, the ESG-Industrial Complex has pushed their agenda on public companies during proxy season, harming everyday investors in the process," said American Securities Association President and CEO Chris lacovella . "Proxy advisors are central to this problem, yet they have operated for years with little regulatory oversight or accountability. The ASA applauds Rep. Nunn for his leadership on this issue and for protecting investors from the politicized and conflicted business model of proxy advisors."

"The proxy advisory industry operates with too many flaws and too many conflicts for their recommendations to be automatically relied upon during proxy season. The Chamber commends Rep. Nunn for addressing the longstanding problem of 'robovoting' and ensuring that proxy votes are always cast in the best interest of investors," said Mike Flood, Senior Vice President, Center for Capital Markets Competitiveness, U.S. Chamber of Commerce . "This legislation will help protect investors and improve the annual proxy process for public companies."

Rep. Nunn's bill was included in the Protecting Americans' Retirement Savings from Politics Act , a broader package addressing the outsized influence of proxy advisory firms over Americans' retirement investments.

The Protecting Americans' Savings Act legislation is supported by the U.S. Chamber of Commerce and the American Securities Association.

Text of the bill can be found here .

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