Tag archives: Institutional Shareholder Services

Ignoring board gender diversity is no longer an option

Discussions around board gender diversity are picking up steam in the lead up to the 2018 proxy season. Some of the leading proxy advisory firms, namely the Institutional Shareholder Services (ISS) and Glass Lewis & Co. LLC (Glass Lewis), appear to have caught wind of the discussions – both firms added a voting policy in respect of board gender diversity to their 2018 proxy voting guidelines for Canada.

The discussions around board gender diversity are not new. In late 2014 (and as reported on this blog), the Canadian Securities Administrators (CSA) published ‘comply or Continue Reading

Majority voting and board diversity trends

As recently highlighted in the Harvard Law School Forum on Corporate Governance and Financial Regulation, a report (the Report) by Institutional Shareholder Services (ISS) found that majority voting practices and annual board elections, along with increases in board diversity, are the new norm.

The Report examined the public filings of Standard & Poor’s U.S. “Super 1,500” companies (S&P 1500)  comprised of the S&P 500, MidCap 400 and SmallCap 600 indices from the period of July 1, 2014 through June 30, 2015.

Majority Voting and Annual Elections

Majority voting is now the clear market standard amongst … Continue Reading

Updates to ISS proxy voting guidelines

Institutional Shareholder Services (ISS) is one of the leading proxy advisory firms that makes voting recommendations on public companies’ proxy resolutions. In Canada, ISS’ recommendations on transactions and governance issues can have a significant impact on many shareholders’ opinions, and particularly the opinions of institutional shareholders.

ISS publishes its proxy voting guidelines which explain the policies underlying its recommendations. For 2016, ISS updated certain items in guideline. The updates, as described below, are good indicators of investors’ views toward current issues in the corporate governance landscape.

Director Overboarding

In response to information about the average workload for directors … Continue Reading

ISS proposed proxy voting policy changes for 2016

Institutional Shareholder Services (ISS), one of the world’s most influential proxy advisory firms, recently released its draft proposed voting policies for 2016.  ISS is currently requesting feedback on new or potential changes to three voting policies in Canada covering the following areas: director overboarding, compensation-related votes at externally-managed issuers and the introduction of an equity plan scoreboard.

Lowering the Threshold for Overboarding

ISS has recognized the risk in directors sitting on an excessive number of boards, such that directors become over-committed and unable to dedicate the required time and energy to each board necessary to effectively represent shareholders’ … Continue Reading

ISS Updates its Proxy Voting Guidelines for the 2015 Season

On November 6, 2014, Institutional Shareholder Services (ISS) released updates to its Canadian proxy voting guidelines for the 2015 proxy season.  The voting guidelines are effective for meetings held on or after February 1, 2015.  The following is a summary of the most significant changes.

Director Elections

  • Director Independence: ISS has made several changes to their definition of “independence” including:
    • that former CEOs will now be subject to a five year “cooling off” period, after which ISS will classify him/her, on a case-by-case basis, to be independent unless other relationships exist with the issuer or executive officer. Factors taken
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Defensive Tools in Shareholder Activism: The “Voting Pill”

In today’s Financial Post,  Barbara Shecter highlighted the use of modified shareholder rights plans (colloquially known as “poison pills”) as an emerging defensive tool against opportunistic shareholder activism in Canada.  Traditionally, poison pills are used by boards of target companies as defensive tools to guard against unsolicited takeover bids.  By expanding the typical definition of “beneficial ownership” in a poison pill (which is typically limited to concepts of ownership and is used to determine whether the poison pill is triggered) by including securities that a shareholder does not own but has a right to vote or the right to … Continue Reading

Trends and Predictions in Canadian Proxy Contests

Kingsdale Shareholder Services has released its 2014 Proxy Season Review.  In its report, Kingsdale discusses trends observed in 2014, predictions for the future, and gives its key recommendations for companies in the Canadian marketplace.  In reviewing 2014 and comparing it to the previous year, Kingsdale observes:

  • By the numbers – the total number of proxy contests observed in 2014 remained at the elevated level seen beginning in 2008, but was down slightly from 2013.  Kingsdale suggests a number of factors for the relative decline, including stronger capital markets which have helped to mask under-performers’ deficiencies, the implementation of structural
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