As reported in today's Society Alert:
ISS launched today its Annual Benchmark Policy Survey (pdf here) for the 2023 proxy season that will inform its benchmark policies. As in prior years, the survey includes a series of global-level and region-specific questions.
Global-level topics include:
- Climate board accountability for significant GHG emitters
- Top criteria indicative of the adequacy of companies’ climate transition plans
- Whether auditors should comment in the auditor report on climate-related issues for significant emitters (currently defined as those in the Climate 100+ Focus Group)
- Whether climate risk considerations should be included as CAMs (or equivalent), and any voting actions shareholders should take if climate risk considerations are not included
- Appropriate investor expectations for large companies in the banking and insurance sectors regarding the GHG emissions associated with their lending, investment, and underwriting portfolios
- Whether and how investors' minimum expectations on thresholds for climate-related disclosure and performance will change over time
US-specific coverage includes:
Multi-class capital structures
- Potential benchmark policy exceptions to adverse recommendations on multi-class capital structures
- Appropriate director “targets” for adverse vote recommendations
Problematic governance structures
- Appropriate time period for IPO companies to begin sunsetting problematic governance structures
- Whether smaller companies should be exempted from negative ISS recommendations for maintaining a classified board or supermajority vote requirements
- Whether a supermajority vote requirement of two-thirds of shares outstanding to amend governing documents should generally be considered acceptable
Diversity, Equity & Inclusion
- Views on whether companies would benefit from third-party racial equity or civil rights audits
- Relevant company-specific factors indicating whether a company would benefit from an independent racial equity or civil rights audit
Share issuance mandates at cross-market companies under ISS’ US policy coverage
- Whether ISS should develop a US-specific policy for share issuance mandates, continue to apply its current policy of the market of incorporation, or generally recommend votes in favor
- Acceptable level of dilution if a US-specific policy is developed
The survey closes on August 31, 2022, at 5 pm ET. Institutional investors, companies, corporate directors, and other market stakeholders are all encouraged to participate in the survey. The Society plans to comment. Members interested in participating in this important effort should email Ted Allen at tallen@societycorpgov.org or Suzanne Rolon at suzanne.y.rolon@pfizer.com.
Access additional resources on our Proxy Advisors page.