All items from Davis Polk Briefing: Governance

For companies considering a review of the audit committee disclosure in proxy statements, the recent review by EY's Center for Board Matters provides several insights on some of the additional information that Fortune 100 companies included in 2014. We previously discussed some of the background related to the increased disclosure here.

Posted 3 days 21 hours ago

ISS has published its draft 2015 voting policies for public comment, which are due on October 29. The final release is expected around November 7 and any new updates will apply for meetings taking place on or after February 1, 2015.

Posted 5 days 17 hours ago

Last Wednesday, an 8-K from Icahn Enterprises L.P. reported that its chairman, Carl Icahn, intends to use Tumblr, Facebook, Twitter and a particular website (www. to communicate about the company and “other issues.” The 8-K acknowledges that it is possible that the information he posts could be deemed to be material information, and therefore the company encourages investors, the media and other interested parties to review this information along with traditional investor relations communications channels such as its own website, SEC filings and press releases.  

Posted 5 days 21 hours ago

The European Council adopted on September 29, 2014, a Directive requiring large public interest entities with more than 500 employees to disclose in their annual reports “relevant, useful information” necessary for an understanding of such companies’ environmental, social, employee, human rights, anticorruption and bribery matters. These companies will also be required to disclose board diversity matters. The disclosure would focus on the companies’ governing policies, related risks and the management of such risks. The Directive will become law 20 days after it is published in the European Union Official Journal (which is expected in due course). Member states will have two years to transpose the Directive into national legislation. Companies will need to begin reporting as of their financial year 2017.  

Posted 6 days 21 hours ago

SEC Chair White signaled that the proposed rules on CEO pay ratio would be adopted before the end of the year at a Senate Banking Committee hearing last month, or at least that was her “hope and expectation.” Senator Menéndez, Congressional author of the rule under the Dodd-Frank Act, responded that he wanted “more expectation and less hope” for meeting that timetable, indicating that the proposal in its current form reflects the “legislative intent.”

Posted 1 week 21 hours ago

Since some companies have made significant changes to the presentation of their proxy statements, Keith Higgins, Director of the SEC’s Division of Corporation Finance, is encouraging companies to make “similar strides” with their periodic reports, such as experimenting with layout, reducing duplication and eliminating stale information. The SEC staff is willing to discuss potential changes with companies, although they will not pre-clear specific disclosures.  

Posted 1 week 6 days ago

91% of big companies disclose the existence of anti-hedging policies and 66% mention anti-pledging policies, according to the Meridian 2014 Governance and Design Survey, which examined the 250 largest public companies by revenue and market capitalization.  Anti-pledging policies generally prohibit all pledging of company shares, although 18% allow some pledging with approval by the board or management.

Posted 2 weeks 20 hours ago

The Center for Political Accountability has published the 2014 CPA-Zicklin Index, which rates 300 companies in the S&P 500 on their disclosure of corporate political spending. Nearly half provide some information about direct payments to state candidate, parties and committees, 527 groups (such as national governors’ associations) and trade associations.

Posted 2 weeks 5 days ago

ISS released the results of its policy survey. The responses, from 105 individual institutional investors and 255 members of the corporate issuer community (including advisers), may inform new policies or change existing policies. Investor and issuer views diverged in some cases. Draft policies are expected to be released in October for public comment.  

Posted 2 weeks 6 days ago

The most interesting element of the SEC’s latest whistleblower award, the largest so far at $30 million, may be the lengthy footnote that explains why the Commission believes an award payment is appropriate even though the claimant resides in a foreign country.

Posted 3 weeks 4 days ago