*

Trump administration reportedly considers executive order

to

limit proxy advisory firms

*

Conservatives criticize proxy advisors for liberal-leaning

views

and climate focus

*

ISS and Glass Lewis defend their fiduciary duties and

transparency

(Updates with more direct source and context on proxy voting,

bylines, changes headline)

By Ross Kerber and Manya Saini

Nov 12 (Reuters) -

The White House is exploring new measures to curb the

influence of proxy advisers which conservatives have for years

complained push liberal-leaning views, according to a financial

industry official briefed on the matter.

Trump administration officials are also exploring limits on

how index-fund managers are allowed to vote, the person said on

condition of anonymity to discuss confidential regulatory

matters.

The Wall Street Journal first reported on Wednesday that

administration officials are discussing at least one executive

order that would restrict proxy-advisory firms such as

Institutional Shareholder Services and Glass Lewis, citing

people familiar with the matter. Reuters could not immediately

confirm the potential executive order.

The industry official said the administration has been

"kicking around" ideas for a few months on how to regulate or

curb proxy voting and the proxy advisers.

Discussion about potential executive orders is purely

speculation until they are officially announced, a White House

official said.

Conservatives and some business leaders have for years

aired a variety of complaints about proxy advisers and big fund

managers, including that they often recommend votes or side

against boardroom decisions or directors, and have put too much

emphasis on climate and social issues. The advisers and fund

firms say they only seek better returns for clients, but have

taken a softer line

at many corporate meetings in recent years.

Under U.S. President Donald Trump's first administration,

the Securities and Exchange Commission - urged on by corporate

groups -

took aim at proxy advisers

, including by raising the bar for when shareholder

resolutions may be submitted.

Glass Lewis and ISS, the two largest U.S. proxy advisory

firms, have long

drawn criticism

for their influential voting recommendations, traditionally

from corporate executives, but their guidance remains widely

used by institutional investors.

In an emailed statement, an ISS spokesperson said the

investment adviser is committed to fulfilling its fiduciary

duties to clients and operating in a transparent and ethical

manner.

"While we respect the Administration's Executive Order

prerogative, Glass Lewis believes this is more effectively

handled through the constructive engagement of a regulatory

process," a spokesperson for the firm said.

Index-fund managers such as Vanguard, BlackRock ( BLK ) and State

Street, which manage big stakes of most large U.S. publicly

traded companies, have also come under fire from the

administration. All three firms have new systems in place to

give their own investors more say on how shares are voted.

BlackRock ( BLK ) and State Street declined to comment. Vanguard did

not respond to requests for comment.