As expected, the major proposed changes relate to say-on-pay and say-on-frequency.  Of particular interest:

ISS will recommend against or withhold votes against ALL incumbent director nominees if the company adopts a say-on-frequency schedule less frequent than the schedule which received majority shareholder support.

ISS may recommend against or withhold votes on compensation committee members (or, if it deems necessary, all directors) if the say-on-pay vote has received “significant” shareholder opposition.

ISS does not say what “significant” means, but based on the say-on-pay results from 2011, since the vast majority of companies received at least 80% support for the say-on-pay vote, companies that received less than 80% support may be in the crosshairs.  (ISS has asked for comment whether say-on-pay support of less than 70% should warrant a specific response from the company to avoid against/withhold votes on the company’s committee members.)

For companies in this situation, a key factor influencing ISS’s vote recmmendation will be the description of how the company has responded to the say-on-pay vote in the following year’s proxy, a requirement for all public companies (regardless of their level of say-on-pay support) starting with the 2012 proxy season.