Labrador's new report: "Proxy Statement Disclosure Trends & Analysis" reveals the results of its analysis of 248 of the S&P 250 proxy statements (companies listed in the Appendix) filed between September 30, 2018 and August 1, 2019, with suggested investor-friendly designs, formats, and disclosure enhancements, and an abundance of noteworthy benchmarking data. Year-over-year comparisons to the firm's review last year of the Fortune 250 are shared for trend purposes with the understanding that the comparisons are imprecise due to the fact that just 138 of the S&P 250 and Fortune 250 companies overlap.
Key takeaways include:
Leadership letters
- 39% included a substantive letter from the Chair or CEO (or combined CEO/Chair) summarizing governance and business highlights.
- 4% included a letter from the entire Board of Directors.
- 7% included a letter from the Compensation Committee explaining key updates to the compensation program.
Proxy summaries
- 73% included a proxy summary.
- 61% included a CD&A executive summary.
- 34% included a CD&A table of contents.
- 64% included a "what we do/don't do" table.
Director nominees
- 87% included photos of the directors.
- 65% included a graphic highlighting tenure diversity; 50% included a graphic highlighting gender diversity; and 34% included a graphic highlighting age diversity.
- 38% included an individualized skills matrix / 39% included an aggregated skills matrix.
Board responsibilities
- 22% of companies have a Sustainability, CSR, or Public Responsibility Committee.
- 26% included a graphic of how risk oversight is allocated among the committees & the board.
- 79% identified cybersecurity as a risk overseen at the board level.
- 51% listed sustainability as a board-level responsibility.
- 81 companies discussed HCM. Of those, 45% identified HCM as a risk overseen by a committee or the full board.
Board effectiveness
- 22% used graphics to illustrate the evaluation process.
Looking ahead, Labrador sees longer proxy statements with increasing disclosure of ESG (including HCM) information, strategic objectives and KPIs to address compensation program concerns, and board diversity information.
See also these recent reports: "Human Capital Management Disclosures" and "Guide to Effective Proxies: Samples Galore!" and numerous additional resources on our Annual Meeting/Proxy Statement, Human Capital Management, Board Diversity and Sustainability/ESG pages.