Forbes contributor Robin
Ferracone recently spent time talking with Glass Lewis Chief Policy Officer Robert McCormick. The wide ranging discussion covered several topics, including the recent proxy season, perceptions of proxy advisors, positive and negative trends in governance practices at companies, and how Glass Lewis approaches its analysis.
During the conversation Bob McCormick explained some of the things he feels companies should focus on when thinking about corporate governance.
“In terms of what companies are doing wrong: First, underestimating the knowledge and sophistication of institutional investors… Second, misinterpreting the shareholder engagement process… Third, paying big bonuses on operating metrics when shareholders have lost money. In terms of what companies are doing right: First, constructive engagement with shareholders… Second, better disclosure… Third, building better mutual understanding between investors and issuers.”
Robin Ferracone commented on the importance of disclosure when it comes to pay for performance.
“There are some big takeaways from our discussion. Contrary to popular belief, proxy advisors and investors are supportive of customized approaches to compensation – they are not necessarily tethered to one size fits all, nor are they wedded to the use of TSR. However, as issuers customize measures and program design to the demands of the industry and the company’s business strategy, the burden also is on the company to clearly communicate the rationale through transparent disclosures and active engagement, and also to ensure that pay and performance are aligned.”
Read the full discussion here.
Disclaimer
© 2020 Glass, Lewis & Co., and/or its affiliates. All Rights Reserved.
This blog is for informational purposes only and is updated periodically to keep Glass Lewis' clients and other interested parties informed of current corporate governance developments and regulatory trends. The information contained herein should not be construed as legal or investment advice. Glass Lewis analyzes issues it believes may be of interest to its subscribers and makes recommendations as to how Glass Lewis believes institutional shareholders should approach such issues. While Glass Lewis may mention certain companies in its blog postings, Glass Lewis never comments on the investment merits of the securities issued by the subject companies. Therefore, none of the information posted through this blog should be construed as a recommendation to invest in, purchase, or sell any securities or other property. All recommendations stated herein must be construed solely as statements of opinion, and not as statements of fact, and may be revised based on additional information or any other reason at any time.
The information contained in each blog posting is based on publicly available information. While Glass Lewis exercises reasonable care to ensure that all information included in this blog is accurate and is obtained from sources believed to be reliable, no representations or warranties express or implied, are made as to the accuracy or completeness of any information included herein. In addition, Glass Lewis shall not be liable for any losses or damages arising from or in connection with the information contained herein or the use or inability to use any such information.
Glass Lewis expects readers of its blog possess sufficient experience and knowledge to make their own decisions entirely independent of any information contained in Glass Lewis’ blog postings. Subscribers are ultimately and solely responsible for making their own decisions. This blog is intended to serve as a complementary source of information and analysis for subscribers in making their own decisions and therefore should not be relied on by subscribers as the sole determinant in making decisions.
Ferracone recently spent time talking with Glass Lewis Chief Policy Officer Robert McCormick. The wide ranging discussion covered several topics, including the recent proxy season, perceptions of proxy advisors, positive and negative trends in governance practices at companies, and how Glass Lewis approaches its analysis.
Glass Lewis RSS