Glass Lewis’ 2021 Proxy Voting Policy Guidelines are now available for the United States and Canada, Continental Europe, Japan, and the UK. In addition, we have released our 2021 Environmental, Social & Governance (“ESG”) Policy Guidelines, covering shareholder proposals. Guidelines for additional markets will follow over the coming weeks.
You can access our upcoming 2021 Proxy Voting Policy Guidelines here.
The policy guidelines set out Glass Lewis’ approach to assessing all topics on the annual general meeting agenda, covering everything from director elections, executive compensation, boards and balance sheet management to ESG issues. They are reviewed at least annually and tailored to reflect the governance and regulatory environments of each market, while keeping a global perspective in mind. Specific focus is paid to recent and pending changes to rules, requirements and market practices, along with any other factors that could materially affect shareholder rights or stewardship more generally.
Our 2021 market guideline updates reflect the trending topics at the top of mind for investors and issuers, as well as the impact of the pandemic on governance and stewardship practices. Notably, we will now recommend voting against when companies in North America, Europe and the UK maintain all-male boards. Additionally, we are phasing in additional scrutiny of board-level environmental & social oversight, and have enhanced our broader ESG policies. For an overview of other changes, see below.
- In the U.S., we have put increased focus on board diversity and refreshment to reflect both increased market expectations and new legal requirements in some states. In addition, we have clarified our approach to virtual shareholder meeting disclosure and companies that IPO with multi-class share structures. We have also added new language addressing special purpose acquisition companies and vote results disclosure.
- We have also reviewed our compensation guidelines to ensure they remain fit for purpose. The 2021 U.S. guidelines reflect codified approaches to executive incentives, along with additional information about approach to peer group methodology.
Environmental, Social & Governance Initiatives
- Our 2021 ESG guidelines include additional guidance on Glass Lewis’ approach to shareholder proposals requesting that companies disclose their EE0-1 reports, along with newly-codified approaches to management-sponsored ESG resolutions and climate-related lobbying. In addition, we have reduced our emphasis on a company’s industry when assessing a range of proposals requesting additional reporting.
Europe & United Kingdom
- Beyond taking a tougher stance on all-male boards, for both Europe and the UK we have expanded our discussion of a range of human capital management and diversity-related topics, covering ethnicity, national origin, skills and experience at the board level and throughout the workforce. In addition, we have introduced guidance on our expectations in respect to the organization and disclosure of virtual shareholder meetings, as well as in respect to proposals that seek to amend a company’s articles of association to allow for virtual shareholder meetings and/or the virtual attendance of directors and executives at shareholder meetings. On remuneration, we have clarified our expectation that remuneration committees retain a level of discretion to ensure that remuneration outcomes for executive directors align with company performance, as well as shareholder and employee experiences.
- For Continental Europe, we’ve also made updates and clarifications to our policy approach on anti-takeover devices (poison pills), along with director age/term limits. For the UK, we will be applying the same board composition expectations for all premium-listed companies going forward, with no exceptions for companies outside the FTSE 350. In addition, we have clarified our approach to assessing investment company boards.
- Reflecting changing attitudes towards strategic cross-shareholdings, we have updated our policy guidelines to review company portfolios, and divestment plans. Starting in 2021, we may recommend voting against the chair of the company (or the most senior executive in the absence of a company chair) when the size of strategic shares held by the company exceeds 10% or more of net assets.
For more details, you can download the published 2021 Glass Lewis policy guidelines here.