On October 24, 2018, Glass Lewis published updates to its Policy Guidelines that will be applicable to all United States company meetings held on or after January 1, 2019. The 2019 Policy Guidelines focus on areas such as board diversity, environmental risk, auditor independence, executive compensation and shareholder rights. The full guidelines are available here. Key updates include the following:
Board Gender Diversity: Glass Lewis will generally recommend voting against the nominating committee chair of a board that has no female members unless the company falls outside of the Russell 3000 index or the company discloses a sufficient rationale for the lack of diversity.
Virtual-Only Meetings: Unless the company provides sufficient disclosure for doing so, Glass Lewis may recommend voting against members of the governance committee of companies that opt to hold virtual annual shareholder meetings without giving shareholders the option of attending in person.
Executive Compensation: Glass Lewis will consider excise tax gross-up provisions, front-loaded awards and excessive sign-on awards as additional factors that may contribute to a negative voting recommendation. The updated guidelines also provide clarification on areas such as pay-for-performance models, discretion in incentive plans and disclosure ratings in Glass Lewis Proxy Papers.