Meridian Compensation Partners has issued a periodic report on key voting results for the 2022 proxy season. The report covers Say on Pay (SOP) outcomes and select shareholder proposals related to pay, social and environmental matters among Russel 3000 and S&P 500 constituent companies.¹
Highlights
The report includes the following key findings:
■ 2022 SOP vote results (through August 8, 2022) largely track prior year levels, but are slightly lower than 2020 levels and historical levels.
■ For the first time, fewer than 70% of S&P 500 companies received more than 90% shareholders support for their 2022 SOP proposals.
■ ISS continues to influence SOP vote outcomes. At both Russell 3000 and S&P 500 companies, a negative ISS vote recommendation depressed positive SOP vote results by more than 30 percentage points.
■ Common reasons for failed SOP vote results include pay-for-performance disconnects and problematic pay practices, such as large one-time or retention awards, often in combination with one another.
■ Among Russell 3000 companies, shareholders voted on only 41 pay-related shareholder proposals in 2022, continuing a multi-year trend, which suggests that many investors address compensation concerns through the SOP vote or issuer engagement.
■ Of those pay-related proposals, shareholders approved only 6 proposals, including (i) 4 proposals requesting a company to obtain shareholder approval of certain severance arrangements and (ii) 2 proposals requesting a company to issue a report on gender and racial pay gaps.
■ Among Russell 3000 companies, shareholders voted upon 211 environmental-related and social-related shareholder proposals in 2022, including 27 proposals that received majority support.
■ The most prevalent shareholder proposal on a social matter asked a company’s board of directors to oversee a racial/civil rights audit conducted by an independent third-party. Eight out of thirty-four such proposals were approved by shareholders.
The full report can be downloaded as a PDF.
¹ Aggregate proxy voting and ISS vote recommendation statistics are derived from data obtained from ISS Corporate Solutions Voting Analytics.
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The Client Update is prepared by Meridian Compensation Partners’ Governance and Regulatory Team led by Donald Kalfen. Questions regarding this Client Update or executive compensation technical issues may be directed to Donald Kalfen at 847-235-3605 or dkalfen@meridiancp.com.
This report is a publication of Meridian Compensation Partners, LLC, provides general information for reference purposes only, and should not be construed as legal or accounting advice or a legal or accounting opinion on any specific fact or circumstances. The information provided herein should be reviewed with appropriate advisors concerning your own situation and issues.
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