Institutional Shareholder Services, the biggest proxy advisor firm, may be losing its expert grip. One of its key executives just left the firm: Qin Tuminelli, who spearheaded the mergers and acquisitions research.
Tuminelli’s leaving comes just a year after the exit of Chris Young, who, as head of M&A and proxy contest research, held the signature slot on most I.S.S. opinions.
Update: Tuminelli is not the only departure from the M&A team at I.S.S., with a source confirming that Waheed Hassan has left as well. Hassan is a chartered financial analyst whose previous position was manager of M&A and proxy contest research at the firm. According to Hassan’s LinkedIn profile, he worked at ISS until February 2011.
Proxy advisors make recommendations to institutional shareholders on how to vote on various corporate governance issues from the composition of the board, to executive pay, to merger proposals. During high-profile, or “contentious,” merger contests, I.S.S. and its competitors jockey for influence, issuing recommendations that used to be taken at face value by investors using their services.
It seems now they’re taken with a grain of salt. The latest evidence that I.S.S. is losing touch with shareholders: HP's nomination of a new board. I.S.S. says the new slate of directors has too many ties to CEO Leo Apotheker, according to a report obtained by CNBC on Wednesday. The news came out last night, but, judging by the fact that the stock is beating the market today, shareholders just don't care.