Report

ISS Releases Four Sets of FAQs, Glass Lewis Provides an Update, and FASB and IASB Make Certain Decisions Relevant to Equity Compensation Plans

March 05, 2015

Proxy advisory firms Institutional Shareholder Services (ISS) and Glass Lewis have both released updates to their policies that outline how they will form recommendations to shareholders on how they should vote on governance, compensation, and other matters for the 2015 proxy season. ISS issued its initial update on November 6, 2014, and Glass Lewis also issued its initial update in early November 2014. The ISS policy updates are effective for annual meetings after February 1, 2015, and the new Glass Lewis policies are effective for annual meetings after January 1, 2015.

Since then, ISS has issued three sets of frequently asked questions regarding its 2015 policies: on December 22, 2014, it issued frequently asked questions about the Equity Plan Scorecard policy (EPSC FAQs) and how ISS intends to implement the policy; on February 9, 2015, ISS issued frequently asked questions on its 2015 US compensation policies (USCP FAQs); and on February 19, 2015, ISS issued additional frequently asked questions on “Selected Topics,” which we briefly address below. The FAQs are effective for annual meetings after February 1, 2015. Also, on January 30, 2015, Glass Lewis announced on its blog certain “enhancements” to performance metrics that it uses in its US and Canadian pay-for-performance models and its US equity plan model, which it updated on February 2, 2015.