Excluding exigent circumstances, BIS generally considers attendance at less than 75% of the combined board and applicable committee meetings to be poor attendance. Where a company has not adequately demonstrated, through actions and/or disclosures, how material issues are appropriately identified, managed, and overseen, we will consider voting against the re-election of those directors responsible for the oversight of such issues, as indicated below. We will evaluate the actions that the company has taken to limit shareholders ability to exercise the right to nominate dissident director candidates, including those actions taken absent the immediate threat of a contested situation. Institutional Shareholder Services (ISS) and Glass Lewis, the leading proxy advisors in the United States, have announced updates and clarifications for their voting guidelines for the 2022 proxy season. To this end, performance reviews and skills assessments should be conducted by the nominating/governance committee or the Lead Independent Director. 0000004157 00000 n
Where companies are unwilling to voluntarily implement one share, one vote within a specified timeframe, or are unresponsive to shareholder feedback for change over time, we generally support shareholder proposals to recapitalize stock into a single voting class. We may support shareholder proposals requesting that implementation of such arrangements require shareholder approval. A companys board of directors should put in place a compensation structure that balances incentivizing, rewarding, and retaining executives appropriately across a wide range of business outcomes. Conversely, we note that some shareholder proposals seek to address topics that are clearly within the purview of certain stakeholders. We may also consider whether executive and/or board members financial interests appear likely to affect their ability to place shareholders interests before their own, as well as measures taken to address conflicts of interest, We prefer transaction proposals that include the fairness opinion of a reputable financial advisor assessing the value of the transaction to shareholders in comparison to recent similar transactions, Whether we determine that the triggering event is in the best interests of shareholders, Whether management attempted to maximize shareholder value in the triggering event, The percentage of total premium or transaction value that will be transferred to the management team, rather than shareholders, as a result of the golden parachute payment, Whether excessively large excise tax gross-up payments are part of the pay-out, Whether the pay package that serves as the basis for calculating the golden parachute payment was reasonable in light of performance and peers, Whether the golden parachute payment will have the effect of rewarding a management team that has failed to effectively manage the company, The company has experienced significant stock price decline as a result of macroeconomic trends, not individual company performance, Directors and executive officers are excluded; the exchange is value neutral or value creative to shareholders; tax, accounting, and other technical considerations have been fully contemplated, There is clear evidence that absent repricing, employee incentives, retention, and/or recruiting may be impacted, Disclose the identification, assessment, management, and oversight of material sustainability related risks and opportunities in accordance with the four pillars of TCFD, Publish material, investor-relevant, industry-specific metrics and rigorous targets, aligned with SASB (ISSB) or comparable sustainability reporting standards. Performance-based compensation should include metrics that are relevant to the business and stated strategy and/or risk mitigation efforts. 0000012767 00000 n
We depend on companies to provide accessible and clear disclosures so that investors can easily understand how their political activities support their long-term strategy, including on stated public policy priorities. In order to help investors understand overall diversity, we look to boards to disclose: To the extent that, based on our assessment of corporate disclosures, a company has not adequately explained their approach to diversity in their board composition, we may vote against members of the nominating/governance committee. WebIn the first half of 2022, we updated our proxy voting guidelines to enhance our commitments in three key areas: Board diversity, climate-related accountability, and cross-shareholding. ? q+Hv~ IicC"%l|lc?gN.yV^}v]wmY]Mtuw?aY:M}Q]1_/)f_Xe[iRVyxrI^r.%"W`O`!q However, in these instances, boards should periodically review the rationale for a classified structure and consider when annual elections might be more appropriate. We generally oppose plans that contain evergreen provisions, which allow for automatic annual increases of shares available for grant without requiring further shareholder approval; we note that the aggregate impacts of such increases are difficult to predict and may lead to significant dilution. We will consider whether the transaction involves a dissenting board or does not appear to be the result of an arms-length bidding process. It is our view that long-term shareholders should have the opportunity, when necessary and under reasonable conditions, to nominate directors on the companys proxy card.[19]. We may oppose plans that provide for the acceleration of vesting of equity awards even in situations where an actual change of control may not occur. While we believe special awards[11] should be used sparingly, we acknowledge that there may be instances when such awards are appropriate. 2036 0 obj
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(go back), 19BlackRock is subject to certain regulations and laws in the United States that place restrictions and limitations on how BlackRock can interact with the companies in which we invest on behalf of our clients, including our ability to submit shareholder proposals or elect directors to the board. As such, as long-term investors, we are interested in understanding how companies may be impacted by material climate-related risks and opportunitiesjust as we seek to understand other business-relevant risks and opportunitiesand how these factors are considered within their strategy in a manner that is consistent with the companys business model and sector. Examples of social issues include, but are not limited to, human capital management, impacts on the communities in which a company operates, customer loyalty, and relationships with regulators. [6] In our experience, greater diversity in the boardroom contributes to more robust discussions and more innovative and resilient decisions. As used in these policies and procedures the term clients/beneficiaries means any We will evaluate these instances on a case-by-case basis. Accordingly, shareholders should have the right to solicit votes by written consent provided that: 1) there are reasonable requirements to initiate the consent solicitation process (in order to avoid the waste of corporate resources in addressing narrowly supported interests); and 2) shareholders receive a minimum of 50% of outstanding shares to effectuate the action by written consent. We evaluate a number of factors, which may include: the qualifications and past performance of the dissident and management candidates; the validity of the concerns identified by the dissident; the viability of both the dissidents and managements plans; the ownership stake and holding period of the dissident; the likelihood that the dissidents strategy will produce the desired change; and whether the dissident represents the best option for enhancing long-term shareholder value. Shareholders should have the opportunity to review substantial governance changes individually without having to accept bundled proposals. The information provided here is neither tax nor legal advice. & zM x;x^y3zO2M"V.#^J,\D We see it as a means to promoting diversity of thought and avoiding group think in the boards exercise of its responsibilities to advise and oversee management. [13] While the TCFD framework was developed to support climate-related risk disclosures, the four pillars of the TCFD governance, strategy, risk management, and metrics and targets are a useful way for companies to disclose how they identify, assess, manage, and oversee a variety of sustainability-related risks and opportunities. It is our view that well-run companies will effectively evaluate and manage material sustainability-related risks and opportunities relevant to their businesses. [8] We recognize that it may take time and that companies with smaller market capitalizations and in certain sectors may face more challenges in pursuing diversity. As noted above, highly qualified, engaged directors with professional characteristics relevant to a companys business enhance the ability of the board to add value and be the voice of shareholders in board discussions. In our view, a strong board provides a competitive advantage to a company, providing valuable oversight and contributing to the most important management decisions that support long-term financial performance. This makes it possible to elect local }mA$ffSDYnbN|d=,AHsNz8L s
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Web the criteria for the active exercise of voting rights are clearly regulated; conflicts of interest are identified and addressed. We will typically support amendments to the charter/articles/bylaws where the benefits to shareholders outweigh the costs of failing to make such changes. Please read the prospectus and summary prospectus carefully before investing. There should be a clear link between variable pay and company performance that drives sustained value creation for our clients as shareholders. A classified board structure may also be justified at non-operating companies, e.g., closed-end funds or business development companies (BDC),[3] in certain circumstances. However, the final voting decision is independent and voting authority rests From time to time, shareholder proposals may be presented to promote auditor independence or the rotation of audit firms. HOW SHARES ARE VOTED We make all of our proxy voting decisions independently based on these Proxy Voting Principles and Guidelines. We encourage boards to disclose their approach to evaluations, including objectives of the evaluation; if an external party conducts the evaluation; the frequency of the evaluations; and, whether that evaluation occurs on an individual director basis. All Rights Reserved. As stated above, a majority vote standard is generally in the best long-term interests of shareholders, as it ensures director accountability through the requirement to be elected by more than half of the votes cast. In our view, shareholders should be entitled to voting rights in proportion to their economic interests. He has worked extensively in the governance space, particularly on the key governance technologies that can support leadership with the visibility, data and operating capabilities for more effective decision-making. The integrity of financial statements depends on the auditor effectively fulfilling its role. We encourage disclosures aligned with the reporting framework developed by the Task Force on Climate related Financial Disclosures (TCFD), supported by industry-specific metrics, such as those identified by the Sustainability Accounting Standards Board (SASB), now part of the International Sustainability Standards Board (ISSB) under the International Financial Reporting Standards (IFRS)Foundation. SASB Standards can be used to provide a baseline of investor-focused sustainability disclosure and to implement the principles-based framework recommended by the TCFD, which is also incorporated into the ISSBs Climate Exposure Draft. While BlackRock is supportive of the shareholder rights to act by written consent and call a special meeting, BlackRock is subject to certain regulations and laws that place restrictions and limitations on how BlackRock can interact with the companies in which we invest on behalf of our clients, including our ability to participate in consent solicitations. We generally do not support shareholder proposals seeking the reimbursement of proxy contest expenses, even in situations where we support the shareholder campaign. We generally favor prompt recoupment from any senior executive whose compensation was based on faulty financial reporting or deceptive business practices. proper books and records relating to proxy voting are kept. Dodge & Cox Funds are distributed by Foreside Fund Services, LLC, which is not affiliated with Dodge & Cox. The information on this website does not constitute an offer to sell, or a solicitation of an offer to purchase, securities in any jurisdiction to any person to whom it is not lawful to make such an offer. [15] It is, of course, up to each company to define their own strategy: that is not the role of BlackRock or other investors. The following issue-specific proxy voting guidelines (the Guidelines) summarize BlackRock Investment Stewardships (BIS) philosophy and approach to engagement and voting, as well as our view of governance best practices and the roles and responsibilities of boards and directors for publicly listed U.S. companies. Accordingly, shareholders should have the right to call a special meeting in cases where a reasonably high proportion of shareholders (typically a minimum of 15% but no higher than 25%) are required to agree to such a meeting before it is called. WebEXECUTIVE SUMMARY Policy Updates for 2023 W W W . However, we may vote against the appropriate committees and/or individual directors if, in our view, the board is ineffective in its oversight, either because it is too small to allow for the necessary range of skills and experience or too large to function efficiently. Nonetheless, in situations where there is a substantial or dominant shareholder, supermajority voting may be protective of minority shareholder interests, and we may support supermajority voting requirements in those situations. 2036 41
These guidelines should be read in conjunction with the BlackRock Investment Stewardship Global Principles. 0000012093 00000 n
This process may include internal board evaluations; however, boards may also find it useful to periodically conduct an assessment with a third party. Mizoram faces the second wave of covid-19 with the bravery of local heroes, ZMC Medical Students Drowned In Tuirivang, Nursing Student Volunteers Herself to Work at ZMC, Perpetrator responsible for tank lorry fire arrested, Mizoram Olympic Association delegates set off for NorthEast Olympic Games 2022, Thingsulthliah PHC Staff Nurse receives Florence Nightingale Award. BIS recognizes that climate change can be challenging for many companies, as they seek to drive long-term value by mitigating risks and capturing opportunities. WebInvesting involves risk, including possible loss of principal. 2023 Dodge & Cox. Employee stock purchase plans (ESPP) are an important part of a companys overall human capital management strategy and can provide performance incentives to help align employees interests with those of shareholders. Specifically, we look for companies to disclose strategies that they have in place that mitigate and are resilient to any material risks to their long-term business model associated with a range of climate-related scenarios, including a scenario in which global warming is limited to well below 2C, and considering global ambitions to achieve a limit of 1.5C. Where the company already has a sufficiently robust majority voting process in place, we may not support a shareholder proposal seeking an alternative mechanism. 0000050955 00000 n
(go back), 13The International Financial Reporting Standards (IFRS) Foundation announced in November 2021 the formation of an International Sustainability Standards Board (ISSB) to develop a comprehensive global baseline of high-quality sustainability disclosure standards to meet investors information needs. Companies should disclose the rationale for their selection of primary listing, country of incorporation, and choice of governance structures, particularly where there is conflict between relevant market governance practices. 0000012287 00000 n
We actively engage in ongoing shareholder public debates over proxy-related issues such as Companies with multiple share classes should receive shareholder approval of their capital structure on a periodic basis via a management proposal on the companys proxy. We look to understand a boards diversity in the context of a companys domicile, market capitalization, business model, and strategy. In this context, we encourage companies to include in their disclosures a business plan for how they intend to deliver long-term financial performance through a transition to global net zero carbon emissions, consistent with their business model and sector. Our publicly available commentary provides more information on our approach to HCM. The perpetrator claims that he had gone to siphon gas from the overturned lorry but could only manage to fill one bottle amidst the mob. For example, we recognize that topics around taxation and tax reporting are within the domain of local, state, and federal authorities. Key updates for the 2020 proxy season include: Problematic Governance Structure Newly Public Companies. Relevant shareholder proposals are assessed on a case-by-case basis. Clear and consistent disclosures on these matters are critical for investors to make an informed assessment of a companys HCM practices. BpUgwfZjYhX~,wEY ZQV+U%q?K$v ? Environmental, Social, and Governance (ESG) Integration. We support incentive plans that foster the sustainable achievement of results both financial and nonfinancial consistent with the companys strategic initiatives. Corporate form shareholder proposals are evaluated on a case-by-case basis. 0000015236 00000 n
Before investing in any Dodge & Cox Fund, you should carefully consider the Fund's investment objectives, risks, and charges and expenses. Where a company has failed to appropriately provide robust disclosures and evidence of effective business practices, BIS may express concerns through our engagement and voting. WebProxy Voting Guidelines February 2022 3 Introduction Proxy voting policy As an asset manager, RBC Global Asset Management (RBC GAM) has an obligation to act in the RBC GAM subscribes to the research of both ISS and Glass, Lewis & Co . That diversity can enable companies to develop businesses that more closely reflect and resonate with the customers and communities they serve. We also recognize the potential benefits of dual class shares to newly public companies as they establish themselves; however, these structures should have a specific and limited duration. We may also support a pill where it is the only effective method for protecting tax or other economic benefits that may be associated with limiting the ownership changes of individual shareholders. Common impediments to independence may include: We may vote against directors who we do not consider to be independent, including at controlled companies, when we believe oversight could be enhanced with greater independent director representation. 0000013331 00000 n
These activities can also create risks, including: the potential for allegations of corruption; certain reputational risks; and risks that arise from the complex legal, regulatory, and compliance considerations associated with corporate political spending and lobbying activity. [17] Many companies are asking what their role should be in contributing to an orderly and equitable transitionin ensuring a reliable energy supply and energy security and in protecting the most vulnerable from energy price shocks and economic dislocation. %PDF-1.5
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