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SEC sides with ADF attorneys, denies Wells Fargo, Charles Schwab attempts to dodge shareholders

ADF attorneys now 5-for-5 in securing victories at SEC, as government agency denies financial institutions’ attempts to evade shareholder accountability

Thursday, Mar 28, 2024

WASHINGTON – In two recent decisions, the U.S. Securities and Exchange Commission sided with Alliance Defending Freedom attorneys, turning down attempts from financial giants Wells Fargo and Charles Schwab to sidestep calls for shareholder transparency. The rulings mark ADF’s fifth such victory in as many attempts over the past two years.

Rather than allowing shareholder resolutions to reach the respective proxy ballots for their upcoming annual meetings, both companies had appealed to the SEC, asking the agency to exclude them. Wells Fargo asked the SEC to exclude a proposal that calls for transparency into the risks of politicized de-banking, which was submitted by the American Conservative Values ETF. Charles Schwab sought to block a proposal from Inspire Global Hope ETF that the corporation issue a report evaluating its Diversity, Equity, and Inclusion policies that could contribute to workforce discrimination.

In separate letters, ADF attorneys called on the SEC to deny both requests and instead allow shareholders to consider the proposals on the respective 2024 proxy ballots. The SEC issued the two rulings this month in the lead-up to annual shareholder meetings.

“These are crucial rulings that send an important message to the major corporations Americans rely on every day,” said ADF Senior Counsel and Senior Vice President for Corporate Engagement Jeremy Tedesco. “Like so many others, these companies asked the SEC for permission to avoid addressing legitimate concerns shared by millions of Americans and many of their own shareholders. That strategy is wrong, and as these decisions show, it isn’t working anymore.”

Policies and practices at Wells Fargo and Charles Schwab were both evaluated as part of ADF’s 2023 Viewpoint Diversity Score Business Index—the premiere benchmark measuring corporate respect for free speech and religious freedom. The third-largest commercial bank in the nation, Wells Fargo scored a paltry 10% of 100% possible, while Charles Schwab scored only slightly higher at 13%.

As ADF attorneys argued, Wells Fargo went so far as to redefine “one year” as 366 days to try to convince the SEC that American Conservative Values ETF was unqualified to submit a shareholder resolution because of minimal ownership requirements. For its part, Charles Schwab argued that Inspire Global Hope ETF’s proposal for a report on DE&I was too similar to a 2023 submission focused on politicized de-banking. The SEC rightly rejected both arguments.

Earlier this year, the SEC sided with ADF-backed shareholders who were similarly opposed by Apple, ruling against the corporation’s attempt to keep its shareholders from considering questions about its subjective terms of use policies that allow for religious and political discrimination. The SEC also ruled in favor of ADF-backed shareholders at JPMorgan Chase and PayPal in 2023 when those corporations attempted to duck transparency.

“Publicly traded corporations belong to the shareholders, not the executives they hire to run the company,” said ADF Legal Counsel Michael Ross. “The SEC did what’s right by allowing needed sunlight into the high-level decision-making that impacts the lives not only of shareholders and employees, but countless everyday Americans who depend on these financial institutions to live their lives and participate in the marketplace.”

Find out more about Viewpoint Diversity Score and the Business Index at

Alliance Defending Freedom is an alliance-building, non-profit legal organization committed to protecting religious freedom, free speech, parental rights, and the sanctity of life.


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