Baloise investor zCapital is seeking to change rules that set a 2% ceiling on voting rights at the firm, arguing the amendment would make the Swiss group more attractive. Shareholders can vote on zCapital's proposal on April 26.

In a report seen by Reuters on Tuesday, ISS said it backed the principle of "one share, one vote," after Glass Lewis said a day earlier it was supporting the zCapital proposal. ISS did not immediately respond to a request for comment on the report.

Baloise shareholders have no more than 2% of votes, irrespective of the size of their stake, meaning that major investors like BlackRock or UBS cannot fully bring their weight to bear on decision-making.

The Baloise board has recommended rejecting the proposal, arguing that lifting curbs on voting rights was not in the long-term interests of the firm and most shareholders. A company spokesperson said it took note of ISS's recommendation.

Curbs on voting rights can be used to protect companies from unwanted takeover attempts.

Basel-based Baloise wants to submit its own proposals in 2025 to alter restrictions on voting rights.

(Reporting by Oliver Hirt in Zurich; Editing by Matthew Lewis)