How I Could Help BlackRock, Vanguard, and State Street Survive the Coming Governance Shock
Power, Architecture, and the Future of Corporate Governance
Questions often return in new costumes. What looks like a familiar regulatory scuffle can suddenly reveal itself as a structural confrontation over who holds the keys to the corporate kingdom. As I look at the current turbulence around proxy voting, I find myself wondering: what if this is not really about climate, ideology, or even governance preferences? What if it is a deeper struggle over control of the architecture that steers public markets?
The White House is now exploring measures that could fundamentally reshape how shareholder voting works. This includes potential executive orders that target proxy advisory firms such as ISS and Glass Lewis; possible limits on how index giants like BlackRock, Vanguard, and State Street cast votes for the shares they manage; and an FTC investigation into the influence and competitive practices of proxy advisers.
On the surface, this might look like a regulatory skirmish. It is not. It feels more like the quiet beginning of a structural challenge to the entire way institutional investors exert power inside public markets. And all of this unfolds while AI is rapidly rewriting the expectations around governance, disclosure, trust, and investor visibility. The proxy system was already fragile. Now it is being pressed toward a breaking point.
What the White House Is Really Targeting
Political talking points describe proxy advisers as “liberal leaning,” overly focused on climate or social agendas, or biased against management. But something more basic seems to be happening.
Proxy advisers and index funds have become systemically powerful. Too powerful, according to some administrations. For decades, ISS and Glass Lewis functioned as synthetic governance infrastructure for a system that never built its own. Meanwhile, BlackRock, Vanguard, and State Street accumulated governance influence faster than regulators built frameworks to supervise it. Through indexation, they became the unseen governors of corporate America.
This raises questions that were inevitable, even if overdue. Should firms that manage trillions in public wealth be allowed to steer corporate governance at scale? And if they should, what constraints are appropriate, what transparency is necessary, and according to whose standards should the system operate?
This is where the AI OSI Stack becomes unexpectedly relevant. It was built for exactly this kind of crisis.
The Governance Problem Behind the Governance Problem
I keep circling back to a provocative idea: proxy voting is not broken because of politics; proxy voting is broken because it was never designed for scale, speed, or AI era complexity.
Today’s voting system struggles with several fractures.
Opaque Reasoning
Investors often see recommendations without any visible explanation. They see outcomes instead of the logic that produced them.
Fragile Trust
When reasoning remains invisible, stakeholders begin to imagine hidden ideology everywhere.
Unreviewable Consistency
Two similar proposals can receive entirely different interpretations, yet no framework exists to reveal how risks were weighed.
Batch Scale Decisions Under Pressure
Index managers might vote tens of thousands of proposals in a single season. Human cognitive bandwidth becomes a bottleneck.
Lack of Layered Governance Architecture
Proxy advice blends data, heuristics, policies, models, and judgment, but the system does not explain how these pieces interact or where oversight fits.
This is precisely the kind of environment the AI OSI Stack was designed to stabilize: layered transparency, auditable logic, controlled automation, and infrastructure for reasoning at scale.
Where BlackRock, Vanguard, and State Street Are Exposed
Let me say it plainly: these firms are vulnerable not because of ideological bias, but because they lack transparent reasoning infrastructure. When regulators or politicians demand to know how decisions were made, what frameworks guided them, what data sources were used, where human judgment entered the pipeline, or how any of this is verified, the Big Three have little structural defense.
ISS and Glass Lewis face the same exposure. Which is why the administration can target them with executive order speculation, FTC antitrust inquiries, and political rhetoric about hidden influence. Complex systems that hide their own architecture naturally attract oversight.
How the AI OSI Stack Solves the Proxy Voting Crisis
The OSI Stack provides a layered governance architecture that makes reasoning visible, verifiable, and accountable. Applied to proxy voting, it becomes something unprecedented: an infrastructure for transparent advice and defensible execution.
Layer 1: Civic and Fiduciary Mandate
This layer clarifies the meta rules governing every decision: fiduciary duties, legal requirements, and client selected frameworks. It exposes the intent behind votes, rather than leaving norms implicit and therefore suspect.
Layer 2: Compute and Automation Controls
Index giants already rely on automation. The Stack formalizes which decisions can be automated, which require overrides, and how models are controlled. This shifts the conversation from “algorithms making ideological choices” to a defensible structure of supervision.
Layer 3: Data Stewardship
The Stack logs provenance, weighting, integrity checks, and conflicts of interest whenever data enters the system. This creates a traceable proof of neutrality.
Layer 4: Reasoning Integrity
This is where the crisis sharpens. Proxy reasoning is often opaque, inconsistent, and impossible to audit. The Stack enables structured reasoning templates, persona based analysis, adversarial review, and transparent decision trails. Reasoning becomes something visible instead of something inferred.
Layer 5: Governance Logic and Oversight
Boards and regulators can audit the logic chain, test for ideological drift, and verify that fiduciary mandates were applied correctly. This addresses one of the loudest criticisms: the idea that proxy advisers impose worldviews through hidden logic.
Layer 6: Interface Layer for Investor Choice
Pass through voting experiments by the Big Three already hint at a more democratic system. The Stack extends this by offering interfaces that are standardized, auditable, and customizable at the reasoning level. Investors can finally see why a vote was cast and opt into logic frameworks that align with their preferences.
In Short: The OSI Stack Gives the Big Three What They Currently Lack
A defensible architecture. Transparency becomes a structural advantage.
Scalable reasoning, not just scalable execution. AI becomes a partner in judgment rather than a black box.
A shield against ideological accusations. Decisions acquire visible grounding.
Audit trails regulators can respect. The system speaks the language of accountability.
A path to legitimacy in a polarized environment. Architectural trust replaces rhetorical trust.
A Final Reflection: Proxy Voting as a Test Case for AI Governance
The White House may issue an executive order, or it may not. The FTC investigation may expand, or it may fade. Yet the deeper pattern feels unmistakable. The era of opaque governance is closing. A new era of architectural governance is forming in its place.
Proxy advisers, index funds, and institutional stewards will need transparent frameworks, auditable reasoning, layered decision making, defensible automation, and civic legitimacy. The OSI Stack is not only relevant. It might be the only architecture capable of helping the entire proxy voting ecosystem evolve instead of fracture.
In a moment when trust feels like the scarcest resource in public markets, architecture may become the only durable strategy. And that raises a final question: if governance itself must be rebuilt at the infrastructure layer, who should design the blueprint?
Key Concepts and Definitions
Architectural Governance: A model of oversight that relies on visible, layered systems rather than personal trust or rhetorical assurances.
Proxy Adviser: A firm providing voting recommendations and governance analysis for institutional investors. ISS and Glass Lewis are the largest.
Indexation Power: The governance influence accumulated by index funds that manage trillions in passive assets.
Reasoning Integrity: A structured approach to showing how decisions are made, including templates, personas, and adversarial review.
OSI Stack for Governance: A layered AI architecture that separates mandates, data stewardship, reasoning logic, and oversight to produce transparent and auditable decisions.
Pass Through Voting: A mechanism allowing individual investors in index funds to influence or dictate how their shares are voted.
Works Cited
Kerber, Ross, and Manya Saini. “White House Explores Rules That Would Upend Shareholder Voting.” Reuters, 12 Nov. 2025, www.reuters.com/world/us/white-house-explores-rules-that-would-upend-shareholder-voting-wsj-reports-2025-11-12/
