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ARTICLE · 02 JANUARY 2019

ISS Issues FAQ Related To 2019 US Compensation Policies

Skadden, Arps, Slate, Meagher & Flom LLP
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On December 14, 2018, Institutional Shareholder Services (ISS) issued updated Frequently Asked Questions (FAQ) related to its U.S. Compensation Policies

United StatesEmployment and HR

On December 14, 2018, Institutional Shareholder Services (ISS) issued updated Frequently Asked Questions (FAQ) related to its U.S. Compensation Policies effective for shareholder meetings occurring on or after February 1, 2019. The more notable updates are summarized below.

Nonemployee Director Pay

In 2017, ISS introduced a policy providing for potential adverse vote recommendations for the members of a company's board of directors responsible for approving/setting nonemployee director (NED) pay in the event that ISS determines that there is an established pattern (two or more consecutive years) of excessive pay levels without a compelling rationale or other clearly explained mitigating factors. In November 2018, ISS announced that it would revise its methodology for identifying NED pay outliers and delay the first possible adverse vote recommendations under the policy until 2020 ( see our previous alert here), which was confirmed in the FAQ.

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