ISS Posts 2019 Policy Updates

Yesterday, ISS announced updates to its policies for next year. Like Glass Lewis a month ago, ISS is also—shall we say "unfriendly"— to boards of companies that submit to shareholders a charter or bylaw ratification proposal while excluding, as permitted under SEC rules and staff no-action positions, a conflicting shareholder proposal. Below are some of the highlights of the ISS updates:

Board gender diversity: No change for 2019, but, starting with 2020, for a company in the Russell 3000 or S&P 1500 indices, if there are no women on the company's board, ISS will generally recommend a vote against the chair of the nom/gov committee (or other directors on a case-by-case basis). Mitigating factors include a firm commitment—stated in the proxy statement—to appoint at least one woman to the board in the near term or the inclusion of a woman on the board at the preceding annual meeting.