Fresh from a 2013 season laden with controversy over executive pay and proxy access, proxy advisory firm ISS is now turning its attention to corporate boardrooms.
ISS has launched its annual process of fine-tuning its proxy voting policy for the next season, inviting feedback from institutional investors, shareholders, company directors and other participants to its 2014 policy survey. The firm has already indicated a likely change in direction of its policy for next year.
‘Although aligning executive pay and company performance will continue to be important to institutional investors, we are seeing renewed focus on the directors and boardroom decision making,’ says Martha Carter, head of global research and policy for ISS, in a statement announcing the survey. ‘To that point, we are seeking market input on issues such as board tenure, committee chair rotation and share authorizations.’
ISS has increased the length of time participants have to respond to its annual policy survey –from a month to six weeks – so the survey period ends on September 13, and will be followed by a 30-day period of open comments. The final policy updates will be announced in November, and the changes will take place on February 1 next year. ISS adds that it will try to release its policy updates at least two weeks earlier this year, after releasing the updates on November 16 last year.
ISS will also hold a series of roundtables and conference calls this year focusing on various regions and topics to help it ‘drill into local market best practices’.
Last year’s policy formulation process concluded with changes to the way ISS looks at pay-for-performance evaluations and board responsiveness to majority-supported proposals in the US, board tenure in the Hong Kong and Singapore markets, and voto di lista ‒ or slate-based voting ‒ for boards of directors in Italy.
