2020 Engagement Review - A review of Glass Lewis' global engagement with public companies from July 1, 2019 - June 30, 2020
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Trends and Statistics 2020 Engagement Review A review of Glass Lewis’ global engagement with public companies from July 1, 2019 – June 30, 2020 www.glasslewis.com
About Glass Lewis Glass Lewis is the world’s choice for governance solutions. We enable institutional investors and publicly listed companies to make sustainable decisions based on research and data. We cover 30,000+ meetings each year, across approximately 100 global markets. Our team has been providing in-depth analysis of companies since 2003, relying solely on publicly available information to inform its policies, research, and voting recommendations. Our customers include the majority of the world’s largest pension plans, mutual funds, and asset managers, collectively managing over $40 trillion in assets. We have teams located across the United States, Europe, and Asia-Pacific giving us global reach with a local perspective on the important governance issues. Investors around the world depend on Glass Lewis’ Viewpoint platform to manage their proxy voting, policy implementation, recordkeeping, and reporting. Our industry leading Proxy Paper product provides comprehensive environmental, social, and governance research and voting recommendations weeks ahead of voting deadlines. Public companies can also use our innovative Report Feedback Statement to deliver their opinion on our proxy research directly to the voting decision makers at every investor client in time for voting decisions to be made or changed. The research team engages extensively with public companies, investors, regulators, and other industry stakeholders to gain relevant context into the realities surrounding companies, sectors, and the market in general. This enables us to provide the most comprehensive and pragmatic insights to our customers. Join the Conversation Glass Lewis is committed to ongoing engagement with all market participants. Investors and public companies can contact Glass Lewis at any time at engage@glasslewis.com. You can also access a wealth of free resources and tools such as thought leadership, our policy guidelines, and our engagement policy at www.glasslewis.com. Public companies can request a meeting, report an error, or submit filings through the Glass Lewis website. To get an overview, you can also visit the Public Company Overview Page. 2020 Engagement Review: Trends & Statistics 2
About the Review This review shines a spotlight on Glass Lewis’ 2019-2020 public company engagement efforts to further increase transparency of our role within the investment ecosystem, and provides an overview of our public company engagement initiatives, highlighting statistics, impacts, and trends. Connecting with public companies helps Glass Lewis research analysts understand the unique industry and regulatory matters affecting public companies and the shareholders who invest in them. Short on Time? Click Below & Skip Ahead Meetings & Public Company Research Analyst Engagement Policy Interviews Interviews Pg. 5 Pg. 9 Pg. 14 Knowledge Sharing & Issuer Data Report Feedback Networking Report Statement Pg. 20 Pg. 26 Pg. 27 2020 Engagement Review: Trends & Statistics 3
The Glass Lewis Engagement Process
Engage as necessary Verify Data through
1 with company 7 Issuer Data Report
Public company can
2 Identify meeting
8 report errors, omissions,
or new filings if needed
9
Gather company
3 documents
Publish report
Update report with
Assign analyst and
4 prioritize report 10 Report Feedback
Statement(s) if submitted
Process meeting
5 Compile report
11 data using Glass Lewis
Rules Engine
Provide custom vote
6 Edit report
12 recommendations via
Glass Lewis Viewpoint,
as applicable
2020 Engagement Review: Trends & Statistics 4Meeting with Our Research Experts
We believe discussions with public companies at the appropriate time fosters mutual understanding and
promotes better disclosure for shareholder consideration.
Glass Lewis strives to facilitate as many meetings as possible each year. We encourage and welcome public
companies and their representatives to request meetings via our engagement team or by visiting our
Meeting Request page.
Per our engagement policy, Glass Lewis primarily engages with companies outside each market’s respective
proxy season. All requests are considered on a case-by-case basis.
Due to the unique nature of M&A transactions, contests and other special situations, engagements with
our specialist M&A and ESG research teams are generally scheduled following the publication and review
of meeting materials. To maintain fairness, we always offer both sides the same opportunity to engage on
special resolutions.
General Engagement Meetings
• Before a company discloses meeting materials
• Outside the research teams’ busy
proxy season*
1,500+ 1,300+
Meetings Held Companies Met
• First-come, first-served
40+ 20+
Contested and M&A Engagements Countries Covered Languages Spoken
• Generally after publication of meeting
materials
• Equal opportunity afforded to all sides
• Case-by-case basis, as appropriate
*Glass Lewis’ research teams engage most often outside of their the busy writing seasons: March 1-July 1 for Asia (excluding India),
EMEA, Latin America, North America; June 1-October 1 for India; August 1-January 1 for Australia.
2020 Engagement Review: Trends & Statistics 5Glass Lewis Around the World Engagements and Meetings 1,500+ 650+ 550+ 350+ Engagements EMEA Americas Asia Pacific 400+ 1,100+ In-person Meetings Teleconferences In-Person Meetings Australia England Greece Japan Sweden Austria Finland Ireland Netherlands Switzerland Belgium France Israel Norway Turkey Canada Germany Italy Spain United States Denmark 2020 Engagement Review: Trends & Statistics 6
What We’re Talking About
1,000+ 900+
Executive Compensation Board Related Topics
400+ 100+
E&S Topics Contested/M&A Proposals
Want to Know More?
Visit our blog Click Here | Visit our Special Reports Page Click Here
Access thought leadership pieces such as:
• New Rules for ESG
• Under the Microscope talking with biopharma
• E&S Metrics in Executive Compensation
Glass Lewis does not provide governance overlay services and we are not empowered by clients to negotiate on their behalf for specific
changes to any company’s practices or structures. Our research is based solely on publicly available information to ensure clients have
access to all relevant information and are fully empowered to make informed voting decisions, while minimizing potential conflicts of
interest. Glass Lewis does not guarantee the outcome of any pending analysis or recommendations and analysts do not provide any
information about clients’ voting patterns.
2020 Engagement Review: Trends & Statistics 7ESG Conversations
“
Our conversations on ESG issues help us to stay ahead
of evolving issues that are critical to shareholders.”
Courteney Keatinge
Senior Director, Environmental, Social & Governance Research
The Goal
When Glass Lewis reviews shareholder initiatives, our goal is to determine whether adoption of the
resolution would, over the long term, benefit companies by helping them to mitigate financial risk or seize
accretive opportunities.
Human Capital Management Climate Change
Companies, buoyed in their efforts by a significant Climate change continues to be a prominent
investor focus on human capital management, have topic of engagement between public companies
been working to provide meaningful disclosure and investors, with many of these discussions
about how they are considering and managing focused around how companies are mitigating
related issues. However, as there is currently no environmental impacts and managing attendant
commonly-accepted standard for disclosure on risks. In recent years, investors have grown
this issue, many public companies have struggled increasingly sophisticated in their understanding
with how to best communicate their efforts. of climate change, and, on a global basis, are often
Particularly in light of the COVID-19 pandemic and asking for more disclosure and action on this issue.
the recent attention on issues of systematic racism, During the 2020 season, we saw notable support
our expectation is that this is an area that will for climate-related proposals at Ovintiv, JPMorgan,
continue to gain importance for both investors and Mizuho Financial and Woodside Petroleum, among
companies. others.
2020 Engagement Review: Trends & Statistics 8THE VALUE OF
ENGAGEMENT
Dixons Carphone Warehouse plc
“
The meeting [with Glass Lewis] provided helpful
context on expectations for Environmental, Social
and Governance reporting as well as practical
suggestions....”
Nigel Paterson
General Counsel and Company Secretary
What is your company’s general approach to What prompted you to hold an engagement
stakeholder engagement? meeting with Glass Lewis this year?
The Board values opportunities to engage with our We were keen to understand the areas of focus for
stakeholders to understand their views and respond Glass Lewis in the current proxy season. If there
to any questions they may have. Each year, Dixons is specific information that is of interest to our
Carphone contacts all of our major shareholders and stakeholders, we will seek to include it in a prominent
offers a meeting with their choice of the Chair of the place in our annual report.
Board, Chair of the Audit Committee or Chair of the
Remuneration Committee. In 2019/20 these meeting What insights did you take away from your
invitations were sent to shareholders representing meeting?
70% of the issued share capital. All shareholders are The meeting provided helpful context on expectations
able to submit any questions throughout the year to for Environmental, Social and Governance reporting
the company secretariat or investor relations teams as as well as practical suggestions. We also had an
appropriate. We also meet with proxy advisory firms informative discussion on the emerging practice for
and industry representatives. companies to include ESG related measures within
incentive plans.
Our customers, our colleagues, our suppliers and the
wider community in which we operate are our other Going forward, how does Glass Lewis fit into
key stakeholder groups. Responsibility for how and your stakeholder engagement plans?
when we engage with each of our stakeholder groups We hope to continue to have a regular dialogue
is assigned to the appropriate forums and colleagues with Glass Lewis. We are keen to maintain our
within our business but in all cases, there is reporting understanding of the issues that are important to
back to the Dixons Carphone plc Board. our stakeholders.
2020 Engagement Review: Trends & Statistics 9THE VALUE OF
ENGAGEMENT
F.N.B. Corporation
“
…engagement is a year-long pursuit which entails an James Orie
open and two-way dialogue with our various stakeholders Chief Legal Officer and
Corporate Secretary
for the purpose describing and receiving feedback on
our long-term responsible growth & business strategies,
compensation philosophy, governance processes and
equitable employee practices.”
What is your company’s general approach to What insights did you take away from your
stakeholder engagement? meeting with our research team?
F.N.B. Corporation’s (F.N.B.) approach to stakeholder F.N.B.’s annual interactions with Glass Lewis offers
engagement is premised on our commitment to our Board and executive management important
build and maintain the trust of our shareholders, institutional investor perspectives regarding
employees and communities. Accordingly, F.N.B.’s governance, corporate responsibility, executive
stakeholder engagement is a year-long pursuit which compensation and disclosures matters.
entails an open and two-way dialogue with our
various stakeholders for the purpose describing and Going forward, how does Glass Lewis fit into
receiving feedback on our long-term responsible your stakeholder engagement plans?
growth and business strategies, compensation F.N.B. will continue to engage with Glass Lewis
philosophy, governance processes and equitable representatives since we have found that these
employee practices. engagements offer us valuable insight into institutional
shareholder perspectives, public company best
What prompted you to organise/accept an practices and emerging trends regarding governance,
engagement meeting with Glass Lewis this executive compensation, corporate responsibility and
year? disclosure transparency considerations.
As a “proxy” for the various interests and perspectives
of institutional investors and as a leader in promoting
“best in class” governance, compensation and
corporate responsibility practices, Glass Lewis offers
valuable insight and understanding of the public
company practices which are important to these
investors.
2020 Engagement Review: Trends & Statistics 10THE VALUE OF
ENGAGEMENT
EROAD
“
Glass Lewis has a wealth of information on corporate
governance and best practice which we love tapping
into in order to continue to improve our engagement
and processes.”
Mark Heine
EVP, General Counsel
What is your company’s general approach to What insights did you take away from your
stakeholder engagement? meeting with our research team?
EROAD really enjoys speaking to its stakeholders and The heightened focus of stakeholders on risk and the
each year we proactively reach out to various groups importance of being proactive here. It was great to
to obtain feedback on what is going well, what EROAD hear that EROAD was seen as taking a leading stance
can improve and what are the key concerns of our on its risk appetite.
stakeholders.
Going forward, how does Glass Lewis fit into
What prompted you to organise/accept an your stakeholder engagement plans?
engagement meeting with Glass Lewis this We will continue to speak at least annually with Glass
year? Lewis.
We see Glass Lewis as a key partner who we engage
with each year. Glass Lewis has a wealth of information
on corporate governance and best practice which we
love tapping into in order to continue to improve our
engagement and processes.
2020 Engagement Review: Trends & Statistics 11THE VALUE OF
ENGAGEMENT
AJ Bell plc
“
Following our IPO in December 2018, the Board more Shaun Yates
formally identified the Company’s key stakeholders … Head of Investor
Relations
establishing a structured programme of engagement with
them ... designed to ensure that the Board is aware of
their views and can take them into account as part of its
decision-making processes.”
What is your company’s general approach to What insights did you take away from your
stakeholder engagement? meeting with our research team?
AJ Bell’s Board recognises the importance and benefits The meeting gave us a much better understanding of
of engaging with shareholders and other stakeholders, Glass Lewis’ approach to engaging with companies
and has a strong history of doing so. Following our IPO and who the key contacts are for us. It also helped
in December 2018, the Board more formally identified us to understand areas of particular focus ahead of
the Company’s key stakeholders with a view to the our first AGM. Following our first meeting, we had a
business establishing a structured programme of much better sense of how certain resolutions would be
engagement with them. This programme comprises received by shareholders—in particular with respect to
a variety of engagement types across the different our Directors’ Remuneration policy—which provided
stakeholders and is designed to ensure that the Board useful insight for the AJ Bell Board.
is aware of their views and can take them into account
as part of its decision-making processes. Going forward, how does Glass Lewis fit into
your stakeholder engagement plans?
What prompted you to organise/accept an We know that many of our shareholders use Glass
engagement meeting with Glass Lewis this Lewis’ research and recommendations to support
year? their voting decisions at the AGM. We therefore
Ahead of our first AGM as a listed company, we want to ensure that Glass Lewis are kept informed
engaged with Glass Lewis for two main reasons: to with the latest developments within our business,
help build an understanding of Glass Lewis’ approach particularly with respect to material items voted on
to engagement with companies, how they form their by shareholders, and will look to engage with them at
voting recommendations and what areas they felt were least annually before our AGM notice is circulated.
particularly material for investors; and, to explain our
new Directors’ Remuneration Policy, in particular the
reason for certain non-standard elements, as it was
being voted on by shareholders for the first time.
2020 Engagement Review: Trends & Statistics 12THE VALUE OF
ENGAGEMENT
Barrick Gold Corporation
“
As part of our stakeholder engagement program
we have been meeting regularly with Glass Lewis
since 2014.”
Darian Rich
Executive Vice-President, Talent Management
What is your company’s general approach to What prompted you to hold an engagement
stakeholder engagement? meeting with Glass Lewis this year?
We believe that a modern mining company must As part of our stakeholder engagement program we
integrate environmental, social and economic have been meeting regularly with Glass Lewis, since
considerations into all its business decisions and 2014. These meetings provide a forum in which we
implement these in a responsible partnership with its can explain changes and answer questions. Since the
stakeholders. Our partnership engagement methods merger of Barrick with Randgold Resources in 2019,
have been tailored to the needs of our various it has also given us the opportunity to be clear about
stakeholder groups and range from presentations, Barrick’s new sustainability and governance principles
mass meetings, townhalls with our CEO, site meetings and goals.
with employees to one-on-one meetings with investors.
Barrick’s board has adopted a formal shareholder What insights did you take away from your
engagement policy which facilitates an open dialogue meeting?
between the board and the company’s stakeholders. It gave us a valuable insight into Glass Lewis’s
It receives periodic updates on stakeholder expectations.
communications and responds to or meets with them
when appropriate. It is our policy that the Barrick Going forward, how does Glass Lewis fit into
board visits at least one of our operations annually and your stakeholder engagement plans?
that the executive leadership team, including the CEO, Based on our partnership philosophy, we intend to
visits each of our operations quarterly. Our CEO and maintain a constructive dialogue with Glass Lewis
the regional executives also meet with our workers, on ESG and other issues as we do with other proxy
community leadership and local and national elected advisory agents.
leaders at least twice a year in each country.
2020 Engagement Review: Trends & Statistics 13MARKET
SPOTLIGHT
Australia
Philip Foo
Director of Research, CGI Glass Lewis 240+
Based in Sydney, Australia Meetings in Australia
80%
Market coverage includes:
ASX100 Engaged
Australia New Zealand
“
We have a primary focus on digging into bespoke company issues;
complaints we have raised in our previous coverage and controversies
playing out in the public arena.”
Boards in our region have some of the highest rates Understanding board dynamics, what the board is
of stakeholder engagement in the world and CGI trying to achieve, and what role individual directors
Glass Lewis runs one of the most comprehensive play brings immense value and insight, allowing our
listed company engagement programs in our analysts to write more informed proxy papers.
market. Due to the high rates of engagement, our
team of analysts work off a dedicated coverage list Companies have told us that they get real value in
and have really benefited from becoming familiar hearing our perspectives, which give them a sense
with the company directors they cover. of the market sentiment towards issues. Companies
get a sense of our voting policies and guidelines and
During engagements, we have a primary focus on where they might run afoul of best practice. They
digging into bespoke company issues, complaints also appreciate the opportunity to explain practices
we have raised in our previous coverage, and or structures that are less conventional.
controversies playing out in the public arena. We
also solicit feedback on our policy guidelines and
seek viewpoints from across the marketplace.
2020 Engagement Review: Trends & Statistics 14MARKET
SPOTLIGHT
Germany
Anke Sänger-Zschorn
70+
Director of Research, IVOX Glass Lewis
Languages spoken: German, English (fluent);
Spanish, French (basic) BVI-Related Meetings
Based in Karlsruhe, Germany
Market coverage includes:
80%+
Engaged in German
Germany Austria Switzerland
“
Our Spring 2020 engagements provided a lot of insight about how
issuers approached the options available to them as a result of COVID-19
emergency legislation.”
The level of engagement we have with companies German Corporate Governance Code, which was
in Germany is a result of many years of continuous fully applicable from March 20, 2020. As a result
networking. Whilst some issuers are reluctant to of the new Code and SRD II being released rather
speak, we’ve found those who have done so turn late, in view of the upcoming season, a considerable
into “regulars“—proactively seeking engagement number of German issuers decided to undergo a
with us year after year. Oftentimes, we will combine final review and postponed a consultative vote on
issuer engagements with the Glass Lewis research remuneration from 2020 to 2021.
team. Taking this collaborative approach provides
companies with the opportunity to speak to us at Our Spring 2020 engagements provided a lot of
the same time, especially when there is a need to insight about how issuers approached the options
explain complex issues. Separate engagement on available to them as a result of COVID-19 emergency
the other hand allows for increased awareness of legislation. We found most companies availed of
the difference between IVOX Glass Lewis’ the option to postpone the meeting to a later date
BVI guidelines and Glass Lewis policy guidelines, and to hold a virtual meeting. Convocation times
and helps companies better understand our varied between 21 and 30+ days, with a majority of
individual approaches to research. companies asking for questions to be submitted by
shareholders up to two days prior to the meeting.
Our markets saw an increase in remuneration
reviews this year as a result of SRD II and the new
2020 Engagement Review: Trends & Statistics 15MARKET
SPOTLIGHT
Japan
Naoko Ueno
70+
VP, Asian Research
Languages spoken: Japanese, English
Based in Tokyo, Japan Meetings in JPN
Market coverage includes:
130+
IDR Participants
Japan China Taiwan
“
…companies setting gender diversity policies appoint more female
directors; however, there is still a gender issues deeply rooted in society,
beyond governance policies.”
We’ve seen an increased level of interest in Over the past number of years, we’ve seen
engagement from the issuer community since companies make year-on-year efforts to improve
opening our new office in Tokyo. We hope this their corporate governance practices i.e. increased
continues to grow as we strive to ensure Japanese number of independent directors, appointing
companies better understand our approach to female directors, etc. From an international
research and the meaning of our policies. standard, practices are not yet sufficient, and we
often highlight non-Japanese investor trends to
There are no say on pay related proposals in encourage increased alignment with global best
the Japanese markets; therefore, agendas and practice. Notably, we’ve observed that companies
discussions often focus on the board composition setting gender diversity policies appoint more
and general corporate governance issues. Our female directors; however, there is still a gender
meetings happen most often with executive issue deeply rooted in society, beyond governance
directors or investor relations teams; companies will policies.
rarely bring independent directors to engagements.
2020 Engagement Review: Trends & Statistics 16MARKET
SPOTLIGHT
France
Patrick Fiorani
70+
Research & Engagement Specialist
Languages spoken: English, French, Italian
Based in Paris, France Meetings in FRA
Market coverage includes:
50%
In-Person Meetings
France Belgium Italy
“
Keeping our finger on the pulse of market updates, and engaging with
issuers regarding their understanding of these, allows us to better clarify
our approach to the ever-changing regulatory landscape….”
Although there is no substitute for direct Each significant legislative change means the
engagement with one’s own shareholders, our following proxy seasons presents novelties, as issuer
engagement with public companies enables them to interpretations of new requirements vary. Keeping
better understand the kind of investor expectations our finger on the pulse of market updates, and
that drive Glass Lewis’ policy and recommendations. engaging with issuers regarding their understanding
of these, allows us to better clarify our approach
We discuss past or future changes to a company’s to the ever changing regulatory landscape, before
corporate governance and executive remuneration each season begins. For example, our continuous
practices with companies. They often seek input engagement with French issuers, throughout 2019,
regarding the level and type of disclosure required meant our research team was primed to understand
to provide shareholders with a full understanding of and evaluate each issuer’s application of governance
the changes they wish to implement. Additionally, changes made possible or required following full
our previous reports on the company are often implementation of the PACTE and Soilihi laws, and
on the agenda. This kind of conversation helps to SRD II.
highlight our key concerns and demonstrate the
practical application of our guidelines to the issuer’s
specific situations.
2020 Engagement Review: Trends & Statistics 17MARKET
SPOTLIGHT
United Kingdom
Bernadette O’Donoghue
Lead Research Analyst
150+
Based in Limerick, Ireland
Meetings in UK & IRL
Market coverage includes:
86%
United Kingdom Ireland Focused of remuneration
“
...our meetings helped contextualise companies’ decision-making and
allowed us to encourage robust disclosure for shareholder consideration.”
The UK is our most established market for Major changes to the Code focused on corporate
engagement in Europe and was particularly culture, stakeholder engagement and board
important in the past fiscal year, which saw composition, and we often discussed wider
significant changes in the UK governance landscape. workforce considerations, including methods
companies intended to adopt to ensure workforce
In July 2018, the FRC published a revised Corporate engagement—a new focus for many UK companies.
Governance Code for companies with fiscal
years starting on or after January 1, 2019; several A large portion (86%) of our engagements focused
companies were required to comply or explain on executive remuneration updates. Engaging
against the code in respect of FY2019. Further, as with companies during their stakeholder outreach
part of their triennial review, over 60% of FTSE 350 allowed us to outline our policies and we focused
companies submitted their remuneration policies for discussions on the adoption of best-practice
shareholder approval at the 2020 AGM. structural features, like post-cessation holding
requirements and aligning pension contributions
As we base our research solely on publicly available with the wider workforce.
information, our meetings helped contextualise
companies’ decision-making and allowed us to
encourage robust disclosure for shareholder
consideration.
2020 Engagement Review: Trends & Statistics 18MARKET
SPOTLIGHT
USA
Crystal Milo
Director of U.S. Research
430+
Based in California, USA
Meetings in USA
Market coverage includes:
690+
USA IDR Participants
“
…companies are increasingly expanding beyond the traditional practice of
only considering people within their networks and are instead engaging
with search firms to provide them with diverse director candidates.”
The sheer size of the U.S. market is one of its One of the more pressing issues facing the U.S.
most distinctive characteristics and issuer market is board diversity. Driven perhaps by a
engagements are a very helpful tool to ensure our growing focus from investors, many of which have
research and recommendations contain nuance and voting policies that encourage the appointment of
a deep understanding of the critical issues facing diverse directors, companies have made significant
companies. strides to ensure broad diversity amongst directors.
On the whole, companies are increasingly expanding
The insight gained through our engagements is beyond the traditional practice of only considering
particularly valuable when we are evaluating the people within their networks and are instead
impact of our policies on different companies and engaging with search firms to provide them with
industries. For example, prior to the 2020 proxy diverse director candidates. Given this focus from
season, we initiated targeted engagements with both companies and their investors, we anticipate
pre-revenue stage biopharmaceutical companies. continued growth in the diversity on boards in the
The knowledge we gained in these meetings has coming years.
resulted in enhanced analysis and a more considered
approach to our recommendations on the board of
directors and on executive compensation matters at
these firms.
2020 Engagement Review: Trends & Statistics 19Knowledge Sharing & Networking
Glass Lewis’ research team actively engages throughout the year by joining conferences and webinars held
across the world. Our teams attend and participate at conferences annually to develop their expertise, share
their perspectives with audiences, and increase their understanding of emerging trends.
Glass Lewis’ research
team presented at
73%
of the conferences
attended.
Events by Market
31 43 9
North America EMEA APAC
Topics Covered by Glass Lewis Presenters
SHAREHOLDER
POLICY
ENGAGEMENT
ESG GOVERNANCE
REMUNERATION
2020 Engagement Review: Trends & Statistics 20SELECTED
HIGHLIGHTS
Knowledge Sharing & Networking
CGI Glass Lewis & Guerdon
Responsible Investment
Associates Annual Japan Institute of Business
Association Australasia 2019
Governance & Remuneration Law 2019 Conference
Annual Conference
Forum 2020
Sydney, Australia Auckland, Tokyo, Japan
New Zealand
CGI Glass Lewis co-hosts a The Japan Institute of
forum on governance and Daniel Smith, General Business Law organized an
executive remuneration Manager APAC for CGI Glass event in December 2019 to
with Guerdon Associates in Lewis, was a panellist at discuss institutional investors’
Australia each year. This year in the Responsible Investment voting guideline trends,
Sydney, panel topics included Association Australasia’s international corporate
the use of board discretion annual conference in Auckland governance practices,
over executive pay outcomes, in September 2019. The panel and current regulatory
the identification and was on active ownership and updates in Japan. Naoko
management of non-financial involved a discussion on how Ueno, Vice President of
risks and the standards of to use the full responsible Glass Lewis’ Asian Research,
conduct expected of corporate investment toolkit, including participated in a panel
Australia by the broader voting, engagement and discussion with representatives
community. A presentation was shareholder resolutions, to of Goldman Sachs
also given over the ASX300 influence corporate behaviour Asset Management and
AGM voting outcomes for and improve responsible Sumitomo Mitsui Trust
2019. Panellists and audience investment outcomes. There Asset Management, as well
members included company were approximately 200 as one of the big four law
regulators, institutional attendees, with some investor firms in Japan, Mori Hamada
investors, non-executive relations professionals & Matsumoto, providing
directors and executives. representing NZ-listed issuers. cross-industry perspectives
on emerging trends and
regulatory requirements.
2020 Engagement Review: Trends & Statistics 21SELECTED
HIGHLIGHTS
Knowledge Sharing & Networking
Swedish Corporate
IVOX Glass Lewis & IHS SWIPRA Corporate
Governance Board
Markit Symposium 2020 Governance Dialog
Conference
Frankfurt, Germany Zurich, Switzerland Stockholm, Sweden
IVOX Glass Lewis has Glass Lewis was an official The Swedish Corporate
hosted annual governance supporter of this annual event Governance Board organised
conferences for many years. In in 2019, bringing together a conference around the
January 2020, the conference board members and executives 2019 revision of the Swedish
was held in collaboration with of listed companies and Corporate Governance Code
IHS Markit, focusing on the corporate governance following the implementation
core topics anticipated for the specialists of institutional of the EU Shareholder Rights
2020 season. Speeches and investors. Andrew Gebelin, Directive. Glass Lewis’ Lead
panel discussions dealt with Glass Lewis’ VP of Research, Analyst for the Nordic Markets,
shareholder activism & active Engagement & Stewardship, Matti Jaakkola, participated
ownership, ESG integration, moderated a panel that in a panel discussion with the
SRD II and the new German explored the changing nature representatives of institutional
Corporate Governance Code. of engagement in Switzerland investors Blackrock, NBIM and
Glass Lewis and IVOX Glass and Europe, with a particular GIC to provide the audience of
Lewis BVI (German investors’ focus on shareholder activism, Nordic issuers and governance
association) policy guidelines ESG, and compensation. The professionals an international
for the German market were panellists, including the chair perspective on Swedish
presented to highlight the of Sunrise Communications corporate governance and
different approaches to policy and representatives of Norges where the focus of issuers
by investors. Participants were Bank Investment Management and regulators will be in the
well-known industry members (NBIM) and State Street future. Matti offered his views
including investors, activist Global Advisors, provided particularly on challenges
shareholders and members of fascinating examples of how in relation to the limited
the German Code Commission engagement had impacted public disclosure in
as well as issuers and various critical decisions at their Nordic markets.
ESG experts. respective firms.
2020 Engagement Review: Trends & Statistics 22SELECTED
HIGHLIGHTS
Knowledge Sharing & Networking
Equiniti Share Executive Compensation and IHS Markit and Glass Lewis
Registration Conference Benefits Conference Governance Briefing
London, UK Amsterdam, Paris, France
Netherlands
In October 2019, Glass Glass Lewis and IHS Market
Lewis’ Lead Analyst for In September 2019, Glass hosted a briefing dedicated to
UK & Ireland, Bernadette Lewis’ Research and ESG and shareholder activism
O’Donoghue, participated in Engagement Specialist in Paris in the fall of 2019. The
a panel discussion, hosted by for Continental Europe, morning was kicked off by
Equinity and focused on the Patrick Fiorani, presented Glass Lewis’ senior French
expectations of companies to the Annual Executive analyst Irene Bucelli, who went
ahead of the 2020 AGM compensation & benefits through the key takeaways
season. The panel also Summit in Amsterdam. from the 2019 proxy season
included representatives of Patrick presented the Glass and highlighted a number
Barclays Corporate Broking, Lewis approach to executive of French governance trends.
RD:IR, Boudicca, and compensation analysis to the The first panel, which explored
the London Stock Exchange, leading industry professionals shareholder activism in the
who provided an overview in Europe and answered French context, brought
of the anticipated trends for questions about Glass Lewis’ together investors, issuers,
the 2020 proxy season to an methodologies. Other speakers and one of France’s foremost
audience of UK plc company included senior Compensation lawyers to activists, and was
secretaries. Bernadette and Benefits figures from a moderated by Glass Lewis’
discussed trends relating number of blue-chip European European Engagement
to executive remuneration, issuers, including AstraZeneca, Specialist Patrick Fiorani. The
gender diversity, and Glass Unilever and Vodafone. lively exchange highlighted key
Lewis’ engagement policies, issues of focus, and activists
outlining the importance engaged with one another
of early engagement with through discussion of recent
shareholders and robust French examples. A follow-up
public disclosure. discussion examined the state
of play of ESG analysis and
ratings in Europe.
2020 Engagement Review: Trends & Statistics 23SELECTED
HIGHLIGHTS
Knowledge Sharing & Networking
Preparing for 2020 Proxy Silicon Valley CFO
Season, hosted by CIRI and Roundtable, SASB Symposium
the TSX Trust hosted by CCI, Inc.
Toronto, Canada San Jose, USA New York, USA
Held in November, this was the CCI, Inc. brings together senior In December 2019, Glass Lewis’
fifth iteration of an annual pre- executives and board members COO, John Wieck participated
season lunch held to prepare of companies into roundtable in a panel on building an
issuers and their advisors discussions of relevant infrastructure for scalable ESG
for the 2020 proxy season. challenges and issues. At the integration. The discussion
The panel participants were Silicon Valley CFO Roundtable, looked at how organizations
representatives from Glass hosted by CCI in July 2020, in the capital markets can play
Lewis, ISS, and an investor Kern McPherson presented to a structural role in supporting
perspective—RBC GAM. the group on emerging trends the growth of ESG integration
in U.S. corporate governance at scale. Glass Lewis provided
Julian Hamud provided the and engagement, observations insights on how clients were
Glass Lewis policy guideline from the 2020 proxy season, integrating ESG considerations
updates and fielded questions and the changing landscape into voting decisions. We also
on these and new Glass Lewis of ESG investing. Participants discussed how we use SASB
compensation methodologies. were especially eager to hear to evaluate materiality and
Other discussion topics were: how Glass Lewis considers the to allow Glass Lewis clients
the growing importance of unique governance challenges to gain additional insight into
environmental disclosure, facing the technology sector. financially relevant factors
institutional investors’ The roundtable participants when they are making
processes for proxy voting, and included two dozen CFOs from voting decisions.
best practices for engaging Silicon Valley-based
shareholders. companies of all sizes.
2020 Engagement Review: Trends & Statistics 24SELECTED
HIGHLIGHTS
Knowledge Sharing & Networking
Berkeley Sustainable Harvard Law School
Business and SRI Conference Corporate Governance
Investment Forum Virtual Roundtable Series
San Francisco, CA Colorado Springs, USA Online
(Cambridge, USA)
In October 2019, Glass Lewis’ In November 2019, Glass Lewis
Senior Director of ESG participated in a panel focused In July 2020, Glass Lewis
Research, Courteney Keatinge, on investor engagement participated in a virtual
moderated a panel on how on climate change. The discussion regarding the
shareholders are responding panelists discussed specifics COVID-19 crisis and how it has
to the #MeToo movement of what and how investors are impacted hedge fund activism.
and incorporating other engaging on climate risk and The discussion, moderated
human capital management provided insight into emerging by Professor Lucian Bebchuk,
issues into their investments issues that would likely play posed the question of whether
and engagements. With out in the 2020 proxy season. activists should take a break
representatives from asset Courteney Keatinge discussed from targeting companies
managers and pension funds, trends in environmental during these uncertain times,
the panel touched on why it shareholder proposals as well and considered the adoption
is important for investors to as insight into how investors of poison pills by issuers in
be considering human capital were incorporating climate- response to the pandemic
management and how they related issues into their proxy and dramatic stock price
can operationalize their focus voting decisions. declines. Jason McCandless,
on corporate culture. Senior Director, M&A and
Contested Meetings, spoke to
Glass Lewis’ perspective and
how activists don’t all have
to stand down in periods of
disruption, emphasizing how
activism can help a company
in uncertain times when boards
and investors have common
goals.
2020 Engagement Review: Trends & Statistics 25Issuer Data Report (IDR) Program:
Pre-Publication Data Review Service
The Issuer Data Report (IDR)
The IDR is deliberately limited to data and relies
program is Glass Lewis’ free service
on facts to avoid:
enabling registered companies
to review key data points used time-consuming and unproductive debate about
by Glass Lewis in our analysis, in methodologies or resulting recommendations; and,
advance of our research analysts
publishing the Proxy Paper.
conflict of interest
Company Registers
IDR Registration Growth
Meeting Documents Disclosed
30-day pre-AGM deadline
Research Team Drafts IDR
IDR Sent To Registered Contacts
48-hr review begins 24-hour deadline reminder sent
Company Feedback Received
Offered to companies in over 25 countries with Hungary,
Czech Republic, Cyprus and Malaysia added in 2019-2020.
Research Team Reviews Feedback
Required updates made Research replies to company
Final Proxy Paper Published
To Customers
2020 Engagement Review: Trends & Statistics 26Report Feedback Statement (RFS)
Launched as a pilot program in 2019, the Report Feedback Statement (RFS) is an innovative offering giving
subject companies and proponents the opportunity to express their opinions in response to Glass Lewis
analysis and voting recommendations. In April 2020, the program was expanded globally and has seen
significant uptake in the United States, Canada, Europe, Australia and Japan.
10 Key Areas of Value
GLOBAL TIMING
Available for all meetings Up to 7 days to respond without
(AGMs & EGMs). delaying research timeliness.
UNCONTESTED ACCURACY
We don’t edit feedback or include Errors corrected, even if company is
competing statements. unable to pre-screen data.
INTEGRATED COST
Included with the report allowing No extra cost; included with the
investor to compare opinions. purchase of our Proxy Paper.
DELIVERY ENGAGEMENT
Clients notified by email; access on All parties equally informed, saving
voting & research platforms. time and resources.
VOTING CONSISTENCY
Allows sufficient time and ability to Research without feedback removed
make or change voting decisions. from view.
2020 Engagement Review: Trends & Statistics 27Report Feedback Statement (RFS) “The RFS provided the opportunity for us to directly send out our important message.” Kentaro Amikura General Manager, Toshiba Corporation “ We appreciated the opportunity to respond to Glass Lewis’ proxy research in the 2020 proxy season. While we ultimately disagreed with some of Glass Lewis’ conclusions, the RFS allowed us to share our views with shareholders on important governance and executive compensation issues. In the event that our opinions differ from those of Glass Lewis’ analysts in the future, we would use the RFS service again.” - S&P 500 Participant 2020 Engagement Review: Trends & Statistics 28
REPORT FEEDBACK
STATEMENT IN
PRACTICE
GIMV
“
The report itself is already a useful instrument in the
context of the dialogue between a listed company and
its shareholders and the RFS approach further fosters
this dialogue.”
Edmond Bastijns
Chief Legal Officer & Secretary General
The service of the Report Feedback Statement (RFS) The [report feedback statement] approach is very
allows us, a listed company, to provide additional logical and simple. Glass Lewis provides their report.
feedback after publication of the Glass Lewis Report. Factual elements can be corrected in the report itself,
The report itself is already a useful instrument in the but feedback on more qualitative findings made by
context of the dialogue between a listed company and Glass Lewis can be given by the company in a separate
its shareholders and the RFS approach further fosters document. The possibility for a listed company to
this dialogue. As we all know, 2020 is a challenging reply on those findings brings a lot of added value
year for everyone due to the COVID-19 pandemic, so for all stakeholders involved: the listed company has
every tool that is provided to maintain a high quality the opportunity to provide further clarification, the
shareholder dialogue—certainly within the current shareholders obtain a full view on what is at stake
circumstances—is interesting to explore. and Glass Lewis as a proxy advisor strengthens its
role as a bridge between the listed company and its
During the 2020 AGM season, Gimv had both an shareholders.
annual general meeting and an extraordinary general
meeting, among others to update our articles of We experienced the approach of the RFS as an
association to the new Belgian Companies Code. In interesting and useful tool to provide additional
this context, the Glass Lewis report contained some clarification and nuance on top of the Glass Lewis
technical attention points that merited further nuance report. As such, as of this year we have included it in
and clarification. This is where the RFS came in quite our shareholder dialogue toolbox.
handy. It allowed us to provide that extra clarification
and, as such, completed the report.
2020 Engagement Review: Trends & Statistics 29Engagement efforts are managed by the
following teams, based across our global offices
North America Asia-Pacific**
San Francisco, CA, USA Sydney, Australia
Lili Mehta, SVP, Global Head of Corporate Business Joanne Antman, Senior Office Manager
Emile Desjardins, National Account Director Kerry Turner, Senior Office Manager
Kayla Missaggia, Engagement Manager Jeff Jackson, Director of Asian Research
Chris Missaggia, Engagement Associate
EMEA, Latin America Japan, South Korea
Limerick, Ireland Tokyo, Japan
Gillian Kelly, Engagement Associate Naoko Ueno,
Charlotte Zhou, Engagement Associate VP of Asian Research
IVOX Glass Lewis*
Arrange a meeting
Karlsruhe, Germany with the Glass Lewis
research team
Anke Sänger-Zschorn,
Director of Research
engage@glasslewis.com
*engagement with German and Austrian-listed companies, based on the BVI guidelines
**except Japan, South Korea
2020 Engagement Review: Trends & Statistics 30Corporate Website | www.glasslewis.com
Email | info@glasslewis.com
Social | @glasslewis Glass, Lewis & Co.
North UNITED STATES Asia AUSTRALIA
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31DISCLAIMER
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