What's new in the report

We’ve made four significant updates to our proxy policy statement that take effect on March 1, 2021.

• A new policy to oppose director nomination where U.S. companies fail to provide data on the compensation of their corporate boards. Investors are able to assess racial diversity only where companies disclose composition data.
• Expanding our opposition to CEOs serving as chair to non-independents serving as chairs. This will enable us to vote against in situations where immediate past CEOs serve as chair or possess other insider characteristics, such as business ties.
• New policy language that provides for a vote against directors for failure of oversight. If a company has not substantively addressed the business impacts of climate change or other systemic issues, has repeated financial restatements or is embroiled in a scandal that exposes weak leadership, a vote may be cast against directors.
• Expanding on the criteria applied to consider say-on-pay votes (advisory votes on executive compensation). Companies often have overly limited disclosure on the use of adjusted generally accepted accounting principles (GAAP) metrics that drive incentive executive pay. Companies that customize a GAAP calculation for executive pay purposes should explain the need for the adjustment and show its impact on the payout.