TheCorporateCounsel.net

Listening to your shareholders ranked pretty high on the list of advice from investor relations professions set forth in Broc’s “Governance Beat” blog, and this excerpt from Glass-Lewis’s blog on the results of the recent proxy season provides some insight into the downside of not listening to the messages shareholders are sending:

Insufficient response to shareholder dissent grew to be the second most popular driver for an against recommendation from Glass Lewis. Despite the years in which the advisory vote on executive compensation has been part of the lexicon in U.S. corporate governance, there are still companies that pay little heed to shareholders’ display of disapproval. These are joined by companies who seem to believe any change to their pay programs demonstrates adequate response to the drivers of higher disapproval. For instance, companies such as Transdigm reported the adoption of a basic clawback policy as part of their attempt to address shareholder feedback while ignoring the 2023 recoupment policy mandated by NYSE and Nasdaq listing requirements.

– John Jenkins