ISS has published its policy on proxy access matters.  ISS will generally recommend in favor of management and shareholder proposals for proxy access with the following provisions:

  • Ownership threshold: maximum requirement not more than three percent (3%) of the votingpower;
  • Ownership duration: maximum requirement not longer than three (3) years of continuous ownership for each member of the nominating group;
  • Aggregation: minimal or no limits on the number of shareholders permitted to form a nominating group;
  • Cap: cap on nominees of generally twenty-five percent (25%) of the board.

ISS will generally review for reasonableness any other restrictions on the right of proxy access.

ISS will generally recommend a vote against proposals that are more restrictive than these guidelines.

For companies that present both a board and shareholder proposal on the ballot on a similar topic, ISS will review each of them under the applicable policy.

ISS noted that as of early February 2015, approximately 50 bylaws allowing fee shifting have been adopted unilaterally, with none put to a shareholder vote. ISS points out its Litigation Rights policy states: “Generally vote against bylaws that mandate fee-shifting whenever plaintiffs are not completely successful on the merits (i.e., in cases where the plaintiffs are partially successful).”