ISS's newly released updated Governance Quality Score adds 17 new factors that are applicable to the US (and other markets in certain instances), and applies three existing factors to the US market for the first time. Each factor is accompanied by the associated question number in the Methodology Guide, which provides additional detail.
Audit category
- Information Security Risk Oversight (new subcategory)
- What percentage of the committee responsible for information security risk is independent? (Q403)
- How often does senior leadership brief the board on information security matters?(Q404)
- How many directors with information security experience are on the board? (Q405)
- Information Security Risk Management (new subcategory)
- Does the company disclose an approach on identifying and mitigating information security risks? (Q402)
- What are the net expenses incurred from information security breaches over the last three years relative to total revenue? (Q406)
- Has the company experienced an information security breach in the last three years? (Q407)
- What are the net expenses incurred from information security breach penalties and settlements over the last three years relative to total revenue? (Q408)
- Has the company entered into an information security risk insurance policy? (Q409)
- Is the company externally audited or certified by top information security standards? (Q410)
- Does the company have an information security training program? (Q411)
- How long ago did the most recent information security breach occur (in months)? (Q412)
Board Structure category
- Diversity & Inclusion - Does the board exhibit ethnic or racial diversity? (Q390)
- Board Practices - What percentage of the sustainability committee is independent? (Q396)
- Board Composition - What percentage of the board has familial relationships with other directors? (Q401)
In addition, these existing Board Structure factors were added to the US market:
- How many executive directors serve on an excessive number of outside boards? (Q36)
- Does the Board Chair serve on a significant number of outside boards? (Q39)
Compensation category
- Communications and Disclosure - What is the level of disclosure on diversity and inclusion performance measures for the short-term or any long-term incentive plan for executives? (Q398)
- Compensation Controversies
- Has the company made special grants to executives excluding the CEO in the most recent fiscal year? (Q399)
- What percentage of the CEO's total compensation was due to special grants in the most recent fiscal year? (Q400)
Shareholder Rights category (existing factors added to US market)
- What is the percentage of multiple voting rights or voting certificates relative to total voting rights? (Q57)
- What percentage of issued share capital is composed of non-voting shares? (Q63)
Appendix III of the Methodology Guide lists all of the factors applicable to the US market.
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