The Dbriefs Governance, Risk & Compliance series presents: 2015 proxy season highlights and other corporate governance developments Tom Ball, Senior Managing Director, Morrow & Co. LLC Maureen Bujno, Director, Deloitte LLP Robert Lamm, Senior Advisor to Deloitte LLP July 30, 2015
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The Dbriefs Governance, Risk & Compliance series presents: 2015 proxy season highlights and other corporate governance developments Tom Ball, Senior Managing.
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The Dbriefs Governance, Risk & Compliance series presents:
2015 proxy season highlights and other corporate governance developments
Tom Ball, Senior Managing Director, Morrow & Co. LLCMaureen Bujno, Director, Deloitte LLPRobert Lamm, Senior Advisor to Deloitte LLP
As used in this document, “Deloitte” means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.
Clawback of Payments under Restatements 15 0 28.42% 3 0 28.70%
Stock Retention/Holding Period 11 0 23.33% 27 0 22.22%
• Many executive compensation-related proposals were put forth by individuals
• Proposals related to CEO-median employee pay ratio appear to have been withdrawn; a few were deemed excludable by the SEC on the basis of Rule 14a-8(i)(7)1
- Rule 14a-8(i)(7) provides that a proposal is excludable when the proposal deals with a matter relating to the company’s ordinary business operations
Environmental, political & social – shareholder proposals2015 proxy season highlights
Report on lobbying payments and policy and report on political contributions
• Many investors seek reports that include lobbying payments (federal and state), payments to trade associations used to lobby, political contributions, and payments to tax-exempt organizations that write and endorse model legislation
• Push for SEC to adopt rule requiring political expenditure disclosure by all public companies; petition has received record level support
Environmental and sustainability reporting
• Increased Catholic investor activity
− Pope Francis’s encyclical; a call to action on global warming
− Catholic groups submitted 12 environmental related proposals at the largest 250 U.S. companies. Proposals called for reports on sustainability and climate-change risk, creation of targets for greenhouse-gas emissions, appointing directors with environmental expertise, etc.
• Conduct a vulnerability assessment of company and board practices in light of shareholder interests and consider a response plan for shareholder proposals
• Understand mix of shareholder base and consider respective approach for outreach
• Review policies and criteria related to board selection, including diversity
• Assess current levels of disclosures and opportunities for enhancement
• Be aware of any voting policy changes put forth by proxy advisory firms
• Prepare for Dodd-Frank requirements effective 2016, 2017
This presentation contains general information only and Deloitte is not, by means of this presentation, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This presentation is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this presentation.
About DeloitteDeloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. Please see www.deloitte.com/about for a detailed description of DTTL and its member firms. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.
About Morrow & Co., LLCMorrow & Co., LLC is a world leader in security-holder services and the advisor of choice for more than 750 publicly-traded companies worldwide, mutual funds, and well-known activists looking to reach and influence shareholders. We believe our depth of knowledge and practical experience are what sets us apart from our competitors. This is an outgrowth of the stability and longevity of our organization – with more than four decades in the business, and a seasoned senior management team. This foundation, coupled with our unique understanding of the investment community and a disciplined approach to research and strategic analysis, is at the core of our broad range of fully-integrated services.