Proxy Advisor Policy Changes for 2018 (Jan. 2018)

Institutional Shareholder Services (ISS) and Glass Lewis recently announced changes to their U.S. benchmark voting policies, which will take effect for annual meetings occurring on or after Jan. 1, 2018 (Glass Lewis) and Feb. 1, 2018 (ISS). ISS has also issued frequently asked question (FAQ) documents dealing with executive compensation. In January, it plans to add proxy voting guidelines on new shareholder resolutions anticipated for 2018.ISS’s primary revisions are limited to a few topics—poison pills, director compensation, and shareholder proposals on gender pay equity—and are largely in keeping with the draft policies it released in October. ISS has additionally made minor modifications and clarifications to other policies that were not included in its draft review.In contrast, Glass Lewis’s policy updates are more drastic in nature, though some do not take effect until 2019. These include taking action against boards that lack gender diversity, hold virtual-only annual meetings, go public with dual-class stock, or are unresponsive to significant shareholder opposition votes. Noteworthy is that ISS covered many of these topics in its fall policy consultation but refrained from making any related policy changes for the upcoming proxy season.

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