Further to our report last week, Labrador's new "Proxy Statement Disclosure Trends & Analysis" reveals the results of its review of 248 of the S&P 250 proxy statements (companies listed in Appendix A) filed between August 16, 2019 and August 14, 2020, with suggested investor-friendly designs, formats, and disclosure enhancements, and an abundance of noteworthy benchmarking data.
Key takeaways include:
Leadership letters
- 44% of proxies included a substantive letter from the board chair or CEO (or combined CEO/Chair) with governance or compensation highlights.
- 12 proxies included a letter from the entire board of directors.
- 7% included a letter from the Compensation Committee explaining compensation program highlights.
Proxy summaries
- 79% included a proxy summary. Most of these included both governance and compensation highlights.
- 34% included a CD&A table of contents.
- 63% included a compensation-specific "what we do/don't do" table.
Director nominees
- 81% included photos of the directors.
- 68% included a graphic highlighting board tenure. | 68% included a graphic highlighting gender diversity. | 36% included a graphic highlighting age diversity.
- 44% included an individualized skills matrix. | 35% included an aggregated skills matrix.
ESG risk oversight
- 32% of companies have a standalone board-level sustainability or public responsibility committee; 76% disclosed board oversight of sustainability risk.
- 52% included HCM disclosure. Of those, 19% include HCM as a board area of expertise,18% reported discussing HCM with shareholders, 31% defined HCM as a company risk or board responsibility, and 14% included HCM within a CSR or ESG section.
- 44% mentioned political spending in the proxy Governance section.
- 94% mentioned diversity as a priority even absent a formal diversity policy.
- 84% explained their approach to, and oversight of, cybersecurity.
Board effectiveness
- 29% used graphics to illustrate the evaluation process; 18% used graphics to illustrate the nomination process.
See our recent reports here: "CEO and Board Leadership Letters - Benchmarking & Examples" | "Proxy Disclosure Examples: ESG" and here: "Benchmarking Board Matrix Disclosures" | "Workforce Diversity Disclosure: Benchmarking & Examples" | "Proxy Disclosure: Non-Financial Compensation Metrics," and numerous additional resources on our Annual Meeting/Proxy Statement page.
This post first appeared in the weekly Society Alert!