NEW YORK (Reuters) -Elliott Investment Management scored a victory on Monday in its board fight at Phillips 66 when prominent proxy advisory firm Institutional Shareholder Services (ISS) recommended that investors elect all four of the activist's director nominees.

Elliott, which owns a roughly $2.5 billion stake in Phillips, has been pushing the oil refiner, valued at $48 billion, for changes that include spinning off or selling its midstream business and wants investors to refresh the board in order to achieve these goals.

Now with ISS's backing, on the heels of a similarly favorable recommendation from the firm's smaller rival Glass Lewis, the hedge fund may have won significant support, analysts and investors said.

Glass Lewis urged investors to elect three of Elliott's four nominees at the May 21 meeting.

Investors often take recommendations from proxy advisory firms into consideration when casting votes on hot-button issues like who sits on boards.

"Although the board has been reshaped since the pandemic, important industry perspectives have been overlooked, and there is strong evidence that the board is not willing to exercise independent oversight of management," the ISS report said.

"The dissident has assembled a strong slate, which has the experience and independence that PSX requires."

The fight between Elliott and Phillips 66 is one of the year's most bitter proxy fights with each side piling time and money into trying to persuade shareholders they have the better candidates.

Neither Phillips 66 nor Elliott had an immediate comment on the report.

Investors will cast votes for four directors who sit on the 14-member board.