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Late last week, shortly after releasing the results from its second annual global policy survey, Glass Lewis announced the publication of its 2025 Voting Policy Guidelines that apply to shareholder meetings held after January 1. For the U.S., the guidelines include added or updated sections on oversight of artificial intelligence, responsiveness to shareholder proposals and change-in-control provisions for executive compensation. The updates also include clarifying amendments regarding reincorporation proposals and executive pay programs and include a policy on Glass Lewis’ approach to evaluating shareholder proposals pertaining to companies’ use of AI technologies, the latter of which is codified in the Shareholder Proposals & ESG-Related Issues Guidelines (global).

Here are excerpts from the summary of changes:

Oversight of AI. In the absence of material incidents related to a company’s use or management of AI-related issues, our benchmark policy will generally not make voting recommendations on the basis of a company’s oversight of, or disclosure concerning, AI-related issues. However, in instances where there is evidence that insufficient oversight and/or management of AI technologies has resulted in material harm to shareholders, Glass Lewis will review a company’s overall governance practices and identify which directors or board-level committees have been charged with oversight of AI-related risks. We will also closely evaluate the board’s response to, and management of, this issue as well as any associated disclosures and the benchmark policy may recommend against appropriate directors should we find the board’s oversight, response or disclosure concerning AI-related issues to be insufficient.

Responsiveness. We have revised our discussion of board responsiveness to shareholder proposal to reflect that when shareholder proposals receive significant shareholder support (generally more than 30% but less than majority of votes cast), the benchmark policy generally takes the view that boards should engage with shareholders on the issue and provide disclosure addressing shareholder concerns and outreach initiatives.

Reincorporation. We have revised our discussion on reincorporations to reflect that we review all proposals to reincorporate to a different state or country on a case-by-case basis. Our review includes the changes in corporate governance provisions, especially those relating to shareholder rights, material differences in corporate statutes and legal precedents, and relevant financial benefits, among other factors, resulting from the change in domicile.

AI-Related Shareholder Proposals. [C]ompanies should provide sufficient disclosure to allow shareholders to broadly understand how they are using AI in their operations and whether there have been any ethical considerations incorporated in their use of this technology. We will carefully evaluate all shareholder proposals dealing with companies’ use of AI technologies and will make recommendations on these proposals on a case-by-case basis. When evaluating these proposals, we will closely review the request of the proposal, and the disclosure provided by the company and its peers concerning their use of AI and the oversight afforded to AI-related issues. We will also evaluate any lawsuits, fines, or high-profile controversies concerning the company’s use of AI as well as any other indication that the company’s management of this issue presents a clear risk to shareholder value.

Change-In-Control Provisions. We have updated our discussion of change-in-control provisions in the section “The Link Between Compensation and Performance” to define our benchmark policy view that companies that allow for committee discretion over the treatment of unvested awards should commit to providing clear rationale for how such awards are treated in the event a change in control occurs.

Executive Pay. We have provided some clarifying statements to the discussion in the section titled “The Link Between Compensation and Performance” to emphasize Glass Lewis’ holistic approach to analyzing executive compensation programs.

Glass Lewis is planning a webinar on December 11 to share additional context. For more commentary and insight, we’ll be posting memos in our “Proxy Advisors” Practice Area.

– Meredith Ervine