The European Union’s revised Shareholder Rights Directive (“SRD II”) is extending the chain of custody for proxy votes, increasing resulting reporting requirements for proxy voters, and expanding the reach of say-on-pay proposals into new markets.

Institutions and asset managers are adjusting to a new voting and reporting environment. Glass Lewis is well positioned to help, with Viewpoint, the most powerful proxy voting platform in the market, and recent updates tailored to support our clients every step of the way. We have also created an SRD II Resource Page to help you navigate the changes.

Tracking Votes

The chain of custody for proxy voting has been extended. For EU companies, the chain of custody now includes an additional confirmation confirming that the voting instructions were voted and counted in the final vote at the meeting. The previous chain ended with a confirmation that voting instructions were passed on to the local market for processing.

To provide transparency Viewpoint now includes new ballot statuses to reflect those confirmations:

As the votes pass along the intermediary chain, clients will be able to track their progress in the ‘Ballot Status’ field. Viewpoint users can now use proprietary workflow filters to sort data based on the new statuses. And on the rare occasions where a proxy vote doesn’t get counted, there is a ‘Rejected Reason’ field in Workflow that can be used to identify the reason for the rejection.

Reporting on Voting

SRD II forces institutions and asset managers to increase transparency around their investment philosophies and approach to stewardship (including engagement and voting). This will be achieved through annual reporting on their vote history, along with half-yearly transparency and disclosure requirements.

The updates to Viewpoint support users as they meet these requirements. The new ballot statuses are baked in to a variety of reporting tools, making it easy to look back on voting activity, and clients can use Viewpoint’s subscriptions feature to integrate the reporting into their workflow.

The improvements also work hand in hand with Glass Lewis’ fully customisable turnkey vote disclosure service, pulling your voting information directly from Viewpoint, and displaying it publicly in a website we build and host. You decide what information is displayed and choose how it is presented, from date range to look and feel. Provide visitors the ability to easily navigate between accounts and meetings, view voting decisions at the interval you prefer (e.g., annually, post-meeting, pre-meeting), and even view your own rationale.

More Say on More Pay

Companies across Europe will be adding say-on-pay votes, one of the most contentious types of proposals, to their shareholder meeting agenda — along with pages of new disclosure to their annual filings, explaining the executive pay structure. Boards in those markets have limited exposure to remuneration voting, and institutional expectations on quantum and pay features. As a result, investors can expect less standardization than they are used to seeing, both in the programme features and their disclosure.

Glass Lewis is maintaining its industry-leading executive pay analysis, which blends local market expertise with a broad spectrum of key remuneration details across dozens of global markets – including those covered by SRD II. Our approach helps identify outliers and puts remuneration into perspective, from plan structure and quantum to specific reward outcomes.

Is Glass Lewis compliant with and prepared for SRD II? 

Glass Lewis is fully compliant with SRD II. In addition to updating our systems to comply with all new data transmission requirements, Glass Lewis is a founding signatory of the leading industry best practice code for proxy advisors. In addition, we’ve reviewed staffing to ensure that our research and voting recommendations aren’t delayed by the additional remuneration and related party transaction proposals that will appear at company AGMs.

Need to Catch Up?

Glass Lewis is committed to supporting institutions and asset managers as these new regulations come into effect. Contact us by clicking the button below to learn more about how our Viewpoint voting platform and Proxy Paper research reports can work with your reporting workflow.


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Public companies looking to learn about the changing requirements and Glass Lewis’ approach to their market can request an engagement meeting with our analysts.