Public companies, take note – Glass Lewis has executive stock ownership guidelines firmly in their sights for the 2024 proxy season.
Recently updated commentary makes clear that robust holding requirements are now a prime governance priority.
Let’s break this down… The 2024 U.S. Benchmark Policy Guidelines specifically directs companies to implement and disclose minimum stock ownership policies to demonstrate alignment with shareholder interests. Glass Lewis further explains how awards are counted toward targets and justification for including unvested PSUs or unexercised option in calculations.
While major proxy advisor ISS has focused on ownership guidelines for some time, Glass Lewis is now formalizing this policy. Executive stock ownership now tops the list of hot-button concerns that can significantly impact Say-on-Pay support.
Considerations for Your Executive Share Ownership Program
As proxy season approaches, take stock of where your executive share ownership program stands today. Does your CD&A disclosure clearly convey your minimum share ownership rules for your NEOs? If you count PSUs or options, have you provided a cogent rationale for doing so?
This Glass Lewis update is a timely reminder that well-crafted executive ownership guidelines are essential for favorable Say-on-Pay outcomes. The team at Infinite Equity continuously stays on the pulse of proxy advisor rule changes to help clients implement ownership programs aligned with current best practices.
And through our partnership with Equity Abacus, we provide an integrated software solution to track and communicate compliance with executive ownership requirements, simplifying compliance processes. Equity Abacus delivers customized ownership reports and decision-based modeling tools that support guideline maintenance. This Glass Lewis update signals executive stock ownership remains a hot button issue.
Let Infinite Equity help you evaluate your current program through an advisor lens, craft disclosure that clearly conveys your philosophy, and implement robust processes supporting ongoing conformity. With proper planning, your next Say-on-Pay vote can be rewarded rather than targeted. For more information on how Infinite Equity can provide assistance, contact us.
