Institutional Shareholders Services ("ISS") published its first standalone UK and Ireland Proxy Voting Guidelines: 2015 Benchmark Policy Recommendations on 7 January 2015. The Voting Guidelines contain vote recommendations for UK and Irish listed companies, as well as companies incorporated in the Isle of Man, Jersey and Guernsey. Smaller companies and investment companies are dealt with separately.
The Voting Guidelines cover the following five core areas:
- Operational items;
- Board of directors;
- Remuneration;
- Capital structure; and
- Other items including approvals of M&A transactions, related-party transactions, incorporation and shareholder proposals.
The Voting Guidelines raise several other points:
- Information regarding the voting outcomes on the resolutions presented at the annual general meeting should be made available as soon as reasonably practicable after the annual general meeting. The information should include the number of votes for and against the resolution, the number of shares in respect of which the vote was directed to be withheld and the overall percentages for each group.
- The Voting Guidelines refer to the new recommendation in the 2014 UK Corporate Governance Code that when, in the opinion of the board, a significant proportion of votes have been cast against a resolution at any general meeting, the company should explain when announcing the results of voting what actions it intends to take to understand the reasons behind the vote result. The FRC does not provide a threshold for significant dissent but ISS predicts that most investors will consider 20% a significant enough level.
The Voting Guidelines are intended to apply to company meetings from 1 February 2015.
A copy of the Voting Guidelines is available at:
http://www.issgovernance.com/file/policy/2015ukandirelandproxyvotingguidelines.pdf.
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