Institutional Shareholder Services, Inc. (“ISS”) issued draft policies for 2013 relating to board governance and to executive compensation. ISS is proposing the following changes:
- Recommend a vote “against” or “withhold” from the entire board if the board failed to act on a shareholder proposal that received the support of a majority of shares cast (rather than outstanding) in the previous year.
- Use a company’s selected peers with size constraints as an input to its peer group methodology
- Incorporate a comparison of realizable pay to grant date pay as part of the qualitative evaluation of pay-for-performance alignment.
- Add pledging of company stock as a factor that may lead to negative recommendations under the existing problematic pay practices evaluation.
- Include existing change-in-control arrangements maintained with named executive officers in its current policy on Golden Parachute proposals (rather than focusing only on new or extended arrangements).
A copy of the draft policies is here.