We acknowledge that the use of peer group evaluation by compensation committees can help calibrate competitive pay; however, we are concerned when the rationale for increases in total compensation is solely based on peer benchmarking. The integrity of financial statements depends on the auditor effectively fulfilling its role. [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. Shareholders should have the opportunity to review substantial governance changes individually without having to accept bundled proposals. Companies should also disclose any material supranational standards adopted, the industry initiatives in which they participate, any peer group benchmarking undertaken, and any assurance processes to help investors understand their approach to sustainable and responsible business conduct. We oppose voting on matters where we are not given the opportunity to review and understand those measures and carry out an appropriate level of shareholder oversight. Companies that build strong relationships with their key stakeholders are more likely to meet their own strategic objectives, while poor relationships may create adverse impacts that expose a company to legal, regulatory, operational, and reputational risks. It is the responsibility of the Committee to evaluate and maintain proxy voting We encourage companies to structure their change of control provisions to require the termination of the covered employee before acceleration or special payments are triggered (commonly referred to as double trigger change of control provisions). Performance-based compensation should include metrics that are relevant to the business and stated strategy and/or risk mitigation efforts. As part of their responsibilities, board members owe fiduciary duties to shareholders in overseeing the strategic direction, operations, and risk management of the company. Where we conclude that a company has failed to align pay with performance, we will vote against the management compensation proposal and relevant compensation committee members. Rather, support for such a proposal might arise in the case of overarching and sustained governance concerns such as lack of independence or failure to oversee a material risk over consecutive years(go back), 5This table is for illustrative purposes only. [6] In our experience, greater diversity in the boardroom contributes to more robust discussions and more innovative and resilient decisions. 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 mergers, acquisitions, asset sales, business combinations, and other special transaction proposals vary widely in scope and substance, we closely examine certain salient features in our analyses, such as: Contested elections and other special situations[9] are assessed on a case-by-case basis. window.CSRF_TOKEN = "a4TST7CknuA7l2r2A33K1P7kwv8WsCSd"; This Renaissance Technologies website (www.renfund.com) is by invitation only. (go back), 6For a discussion on the different impacts of diversity see: McKinsey, Diversity Wins: How Inclusion Matters, May 2022; Harvard Business Review, Diverse Teams Feel Less Comfortable and Thats Why They Perform Better, September 2016; Do Diverse Directors Influence DEI Outcomes, September 2022(go back), 7We take a case-by-case approach and consider the size of the board in our evaluation of overall composition and diversity. WebProxy voting is a key element in our approach to sustainable investing. WebRanked-Choice Voting (also known as instant runoff voting) allows voters to rank a first, second and third choice candidate for a single office. 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. In the event of a proposal for are verse split that would not proportionately reduce the companys authorized stock, we apply the same analysis we would use for a proposal to increase authorized stock. Individual proxy votes therefore will differ from these guidelines from time to time. Further, if a company qualifies as an emerging growth company (an EGC) under the Jumpstart Our Business Startups Act of 2012 (the JOBS Act), we will give consideration to the NYSE and NASDAQ governance exemptions granted under the JOBS Act for the duration such a company is categorized as an EGC. During a CEO transition, companies may elect for the departing CEO to maintain a role in the boardroom. We will normally support proposals seeking to introduce bylaws requiring a majority vote standard for director elections. ? q+Hv~ IicC"%l|lc?gN.yV^}v]wmY]Mtuw?aY:M}Q]1_/)f_Xe[iRVyxrI^r.%"W`O`!q We will typically support qualified ESPP proposals. The materials on this website are for illustration and discussion purposes only and do not constitute an offering. 0000033560 00000 n A proxy voting advice business will be deemed to satisfy the requirements of Rule 14a-2 (b) (9) (ii) (A) if its written policies and procedures are reasonably designed to provide registrants with a copy of its proxy voting advice, at no charge, no later than the time it is disseminated to the businesss clients. 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. It is in this context that we are interested in diversity in the boardroom. The roles and responsibilities cited here are not all-encompassing and are noted for reference as to how these leadership positions may be defined. Goals, and the processes used to set these goals, should be clearly articulated and appropriately rigorous. Disclosure of material issues that affect the companys long-term strategy and value creation, including, when relevant, material sustainability-related factors, is essential for shareholders to appropriately understand and assess how effectively the board is identifying, managing, and mitigating risks. 1 Proxy Voting by Investment Advisers, Release No. Consequently, we ask companies to demonstrate a robust approach to HCM and provide shareholders with disclosures to understand how their approach aligns with their stated strategy and business model. 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. An offering may be made only by delivery of a confidential offering memorandum to appropriate investors. Where the company already has a sufficiently robust majority voting process in place, we may not support a shareholder proposal seeking an alternative mechanism. We may decide to support a shareholder proposal requesting additional disclosures if we identify a material inconsistency or feel that further transparency may clarify how the companys political activities support its long-term strategy. Consistent with our approach to voting on directors, we seek to hold the audit committee of the board responsible for overseeing the management of the independent auditor and the internal audit function at a company. Companies should have an established process for identifying, monitoring, and managing business and material risks. We generally do not support shareholder proposals seeking the reimbursement of proxy contest expenses, even in situations where we support the shareholder campaign. Lastly, we look for shareholder approval of poison pill plans within one year of adoption of implementation. They can be adapted and customized for use by foundations, endowments, asset managers, and retail investors. Among these smaller companies, we look for the presence of diversity and take into consideration the progress that companies are making. 0000013449 00000 n As such, DWSs authority and responsibility to vote such proxies depend upon its contractual relationships with its clients or other delegated authority. DWS has delegated responsibility for effecting its advisory clients proxy votes to Institutional Shareholder Services (ISS), an independent thirdparty proxy voting specialist. As used in these policies and procedures the term clients/beneficiaries means any (go back), 16For example, BlackRocks Capital Markets Assumptions anticipate 25 points of cumulative economic gains over a 20-year period in an orderly transition as compared to the alternative. & zM x;x^y3zO2M"V.#^J,\D Who may vote: If you owned shares of RTX Common Stock at the close of business on March 7, 2023, you are entitled to receive this Notice of the 2023 Annual Meeting and to vote at the meeting, either during the virtual meeting or by proxy. Therefore, we will generally support the reduction or the elimination of supermajority voting requirements to the extent that we determine shareholders ability to protect their economic interests is improved. There should be a clear link between variable pay and company performance that drives sustained value creation for our clients as shareholders. Q (xIP,O# This may not apply in cases where BIS did not support the initial vote against such board member(s), The Independent Chair or Lead Independent Director and/or members of the nominating/governance committee, where a board fails to consider shareholder proposals that (1) receive substantial support, and (2) in our view, have a material impact on the business, shareholder rights, or the potential for long-term value creation, Appears to have a legitimate financing motive for requesting blank check authority, Has committed publicly that blank check preferred shares will not be used for anti-takeover purposes, Has a history of using blank check preferred stock for financings, Has blank check preferred stock previously outstanding such that an increase would not necessarily provide further anti-takeover protection but may provide greater financing flexibility, The degree to which the proposed transaction represents a premium to the companys trading price. [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. It is our view that shareholders should have the opportunity to express feedback on annual incentive programs and changes to long-term compensation before multiple cycles are issued. We frequently oppose proposals requesting authorization of a class of preferred stock with unspecified voting, conversion, dividend distribution, and other rights (blank check preferred stock) because they may serve as a transfer of authority from shareholders to the board and as a possible entrenchment device. Conversely, we note that some shareholder proposals seek to address topics that are clearly within the purview of certain stakeholders. The most common form of ESPP qualifies for favorable tax treatment under Section 423of the Internal Revenue Code. Introducing the possibility of such reimbursement may incentivize disruptive and unnecessary shareholder campaigns. Webguidelines are based on a commitment to create and preserve economic value and to advance principles of good corporate governance. Review recommendations for proxies where the Guidelines specify that the issues are to be determined on a caseby--case basis and ensure such proxies are voted in accordance with these Policies and Guidelines; and Monitoring Proxy Vendor Oversights proxy voting activities (see below). 0000006004 00000 n We look for such companies to disclose[18] how they consider their reliance and use of natural capital, including appropriate risk oversight and relevant metrics and targets, to understand how these factors are integrated into strategy. 0000008767 00000 n Where executive compensation appears excessive relative to the performance of the company and/or compensation paid by peers, or where an equity compensation plan is not aligned with shareholders interests, we may vote against members of the compensation committee. There is growing consensus that companies can benefit from the more favorable macroeconomic environment under an orderly, timely, and equitable global energy transition. Diversification and asset allocation do not ensure a profit or guarantee against loss. Excluding exigent circumstances, BIS generally considers attendance at less than 75% of the combined board and applicable committee meetings to be poor attendance. Webproxy voting principles and philosophy discussed in the Invesco Global Proxy Policy. It is our view that climate change has become a key factor in many companies long-term prospects. As part of this consideration, we encourage companies to produce sustainability-related disclosures sufficiently in advance of their annual meeting so that the disclosures can be considered in relevant vote decisions. SASBs [14] industry-specific metrics are beneficial in helping companies identify key performance indicators (KPIs) across various dimensions of sustainability that are considered to be financially material. Business model, strategy, location, and company size may also impact our analysis of board diversity. h{HSQsusVbf+[2R0J3-\e.Q75)(1YFNB8Z3PmFup}9 @ 834H>$@bj6DQjqgd +E%}#g}Zc[R)FaBvqn[]mS5Wvz>t0AbTF[Rtn&Q6vR _Wlz{N45]f&bg~hh59 FT ^#_gzM6D~f6*.km)[Ng0NBP4+\7&mG(3WkELFYP?R The views and strategies described may not be suitable for all investors. In our view, a strong board provides a competitive advantage to a company, providing valuable oversight and contributing to the most important management decisions that support long-term financial performance. (go back), 8Including, but not limited to, individuals who identify as Black or African American, Hispanic or Latinx, Asian, Native American or Alaska Native, or Native Hawaiian or Pacific Islander; individuals who identify as LGBTQ+; individuals who identify as underrepresented based on national, Indigenous, religious, or cultural identity; individuals with disabilities; and veterans. When voting on a management or shareholder proposal to make changes to the charter/articles/bylaws, we will consider in part the companys and/or proponents publicly stated rationale for the changes; the companys governance profile and history; relevant jurisdictional laws; and situational or contextual circumstances which may have motivated the proposed changes, among other factors. Self identified board demographic diversity can usefully be disclosed in aggregate, consistent with local law. MFS Proxy Voting Committee. BpUgwfZjYhX~,wEY ZQV+U%q?K$v ? We generally support proposals to increase or issue preferred stock in cases where the company specifies the voting, dividend, conversion, and other rights of such stock and where the terms of the preferred stock appear reasonable. In addition, companies that have implemented dual or multiple class share structures should review these structures on a regular basis, or as company circumstances change. Companies may engage in certain political activities, within legal and regulatory limits, in order to support public policy matters material to the companies long-term strategies. That diversity can enable companies to develop businesses that more closely reflect and resonate with the customers and communities they serve. 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. WebThe Proxy Committee may resolve such conflicts in any of a variety of ways, including without limitation the following: (i) voting in accordance with the Proxy Guidelines based In our letter on unequal voting structures, we articulate our view that one vote for one share is the preferred structure for publicly-traded companies. 2036 41 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. We may vote against certain directors where changes to governing documents are not put to a shareholder vote within a reasonable period of time, particularly if those changes have the potential to impact shareholder rights (see Director elections). Continue to $country-name$ Individual Investor site. BIS will also consider the average board tenure to evaluate processes for board renewal. Environmental, Social, and Governance (ESG) Integration. We acknowledge that these factors may also play into the various elements of diversity that a board may attract. We hold members of the compensation committee, or equivalent board members, accountable for poor compensation practices and/or structures. &/%C`6c l`T8N! Please read the prospectus and summary prospectus carefully before investing. We also generally oppose plans that allow for repricing without shareholder approval. WebIn the exercise of proxy voting authority which has been delegated to it by particular clients, the Advisor will apply the following policies in accordance with, and subject to, any We generally support reverse stock splits that are designed to avoid delisting or to facilitate trading in the stock, where the reverse split will not have a negative impact on share value (e.g., one class is reduced while others remain at pre-split levels). Votes therefore will differ from these guidelines from time to time, we look for shareholder approval of pill. 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On this website are for illustration and discussion purposes only and do not ensure a profit or against... A majority vote standard for director elections is a key factor in companies. Should include metrics that are clearly within the purview of certain stakeholders practices and/or structures interested... Size may also impact our analysis of board diversity proxy votes therefore will differ from these from! Summary prospectus carefully before investing most common form of ESPP qualifies for favorable tax under! Qualifies for favorable tax treatment under Section 423of the Internal Revenue Code to accept bundled proposals we also generally plans... The purview of certain stakeholders compensation committee, or equivalent board members, accountable poor!
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