Client Alert
Institutional Shareholders Services, Inc. Issues 2011 Policy Updates
December 8, 2010
Proxy advisory firm Institutional Shareholder Services Inc. (“ISS”) recently issued its 2011 governance and executive compensation proxy voting policy updates (the “Updates”), effective for shareholder meetings occurring on or after February 1, 2011. Given ISS’ influence in today’s compensation and governance environment, many public companies will want to consider the Updates in evaluating whether aspects of their governance or – in particular – compensation practices should be modified, as companies gear up for the new say on pay requirements mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act. ISS’ major compensation-related policy updates include the following:
- ISS will recommend a vote for annual say on pay votes, as opposed to votes every two or three years;
- ISS will evaluate say on pay proposals for golden parachute compensation on a case-by-case basis;
- The list of “problematic pay practices,” which ISS considers in formulating its voting recommendation for say on pay votes, has been streamlined; and
- ISS will no longer accept a company’s future commitment to change a problematic pay practice as a means of preventing or reversing a negative vote recommendation.
Click here to read our client alert summarizing the ISS Updates.
If you have any questions regarding these issues, please contact either the Womble Carlyle attorney with whom you usually work or one of our Corporate and Securities attorneys.
Womble Carlyle client alerts are intended to provide general information about significant legal developments and should not be construed as legal advice on any specific facts and circumstances, nor should they be construed as advertisements for legal services.
IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice within this client alert is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in a client alert.
