The Texas legislature passed a bill June 2 requiring proxy advisory firms to disclose when their shareholder vote recommendations at Texas-based companies incorporate ESG or other non-financial considerations.

If Gov. Greg Abbott (R) signs the bill, it would become the first law of its kind and give Texas companies new legal recourse when proxy advice includes ESG considerations. The two major proxy firms—ISS and Glass Lewis—and ESG-aligned corporate governance experts have opposed the bill.

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