Developments in Securities Regulation, Corporate Governance, Capital Markets, M&A and Other Topics of Interest. MORE

It appears the lone ISS policy update for the US will be to Severance Agreements for Executives/Golden Parachutes.

ISS will vote on a case-by-case basis  on shareholder proposals requiring that executive severance (including change-in-control related) arrangements or payments be submitted for shareholder ratification.

Factors that will be considered include, but are not limited to:

  • The company’s severance or change-in-control agreements in place, and the presence of problematic features (such as excessive severance entitlements, single triggers, excise tax gross-ups, etc.);
  • Any existing limits on cash severance payouts or policies which require shareholder ratification of severance payments exceeding a certain level;
  • Any recent severance-related controversies; and
  • Whether the proposal is overly prescriptive, such as requiring shareholder approval of severance that does not exceed market norms.