Executive order calls for changes to ERISA proxy voting rules 

February 19, 2026

A recent executive order (EO) directs the Department of Labor (DOL) to consider treating proxy advisors as ERISA investment advice fiduciaries. The order also instructs the agency to take other actions to increase scrutiny of proxy advisors’ practices, particularly those involving diversity, equity, and inclusion (DEI) and environmental, social, and governance (ESG) considerations. The EO is part of the Trump administration’s broader campaign to limit the influence of proxy advisor firms and discourage DEI and ESG investment practices. Although the EO doesn’t lay out any specific timelines for DOL to act, plan sponsors and fiduciaries that vote proxies or use proxy advisors should be on the lookout for forthcoming agency guidance.

DOL has long held that a fiduciary’s responsibilities include exercising shareholder rights with respect to plan investments — for example, voting proxies on securities held by the plan. As fiduciary obligations, these actions must be performed prudently and solely in accordance with the plan’s economic interests. When determining how to vote proxies, investment fiduciaries often consider proxy advisory firms’ research and recommendations. 

The EO instructs DOL to “take steps to revise all regulations and guidance” on the fiduciary status of individuals who manage or — like proxy advisors — advise those who manage a plan’s exercise of shareholder rights, including proxy votes and corporate engagement. DOL must consider whether to specify that proxy advisors’ recommendations are fiduciary investment advice.

Under ERISA, anyone who provides investment advice for a fee or compensation is a fiduciary. A fiduciary must act prudently and solely in the interest of the plan and its participants — and can be held personally liable for failing to do so. However, in the past, proxy advisors’ recommendations generally haven’t been treated as fiduciary in nature under DOL’s longstanding five-part test.

Although a Biden-era regulation seeking to expand the definition of ERISA investment advice would extend to proxy voting recommendations, DOL explained in the rule’s preamble that guidelines or other information on proxy voting policies that are provided to a broad class of investors, and without consideration of a plan’s individual interests, generally wouldn’t be investment advice. However, that regulation remains on hold after DOL dropped its appeal of two lower court orders staying the rule’s applicability and is unlikely to take effect in its current form.

The agency has indicated it expects to engage in further rulemaking, but the EO’s directive suggests that future guidance on the definition of ERISA investment advice may not simply be a return to the five-part test — as happened during the first Trump administration. Regulations treating proxy advisors as investment advice fiduciaries might discourage them from making recommendations to ERISA plans.

The EO also directs the Securities and Exchange Commission (SEC) and the Federal Trade Commission (FTC) to evaluate proxy advisors’ practices under other federal laws within those agencies’ respective jurisdictions. The SEC must review and consider revising all rules, regulations and other securities law guidance relating to proxy advisors to the extent that they are inconsistent with the EO’s purpose. The agency must also consider whether to require certain proxy advisors to register as Registered Investment Advisers. The FTC must work with the US Attorney General to review whether proxy advisors are violating federal antitrust laws or engaging in unfair or deceptive acts or practices.

The Protecting Prudent Investment of Retirement Savings Act (HR 2988) aims to curb ERISA fiduciaries’ consideration of ESG factors when selecting plan investments and voting proxies. The bill — which passed the House on Jan. 15 — would resurrect proxy-voting rules from the first Trump administration, including heightened documentation requirements, an explicit prohibition on consideration of nonpecuniary objectives unrelated to participants’ financial interests, and special monitoring obligations for fiduciaries using proxy advisors. The bill would also prohibit fiduciaries from considering “race, color, religion, sex, or national origin” when hiring and monitoring service providers. However, Senate approval of the bill this year is unlikely.

• Protecting American investors from foreign-owned and politically-motivated proxy advisors (White House, December 11, 2025)
• Fact sheet (White House, December 11, 2025)
• News release (DOL, December 12, 2025)

• DOL drops appeal of court rulings blocking 2024 fiduciary rule (January 23, 2026)
• House approves bill to curb ERISA plans’ ESG investing (January 16, 2026)
• Updated regulatory agendas have few new retirement items (October 13, 2025)
• What plan sponsors should know about DOL’s final fiduciary rule (June 20, 2024)
• On second thought, DOL has softer touch with ESG investing rule (December 13, 2022)
• DOL final proxy-voting rule less stringent than proposed (February 22, 2021)

• New executive order addresses proxy advisors and their impact on DEI and ESG initiatives (December 12, 2025)
• Evolving rules on proxy advisors, engagements and proposals shake up 2026 proxy season playbook (November 21, 2025)