ISS Publishes FAQs On Peer Group Selection Methodology And Seeks Input From Issuers On Changes To Self-Selected Peer Groups

On December 4, 2012, ISS published a set of FAQs on its methodology for selecting the 14 to 24 member peer group that it will use to evaluate a company's executive compensation. The FAQs also address how companies can provide ISS with information about any changes to self-selected peer groups. The FAQs can be found by clicking here.

The FAQs note that ISS will select a company's peer group based on:

• the GICS industry classification of the subject company;
• the GICS industry classifications of the company's disclosed benchmarking peers¹; and
• size constraints for both revenue (or assets for certain financial companies) and market value.

In selecting a company's peer group, ISS will choose first from the company's "first degree" peers, which ISS defines as companies that are either in the subject company's own peer group or that have chosen the subject company as a peer, as well as companies with numerous connections to these first-degree peers (by virtue