Glass Lewis, a proxy advisor, recently unveiled its new Equity Compensation Model (“ECM”), which is reportedly intended to provide company issuers and investors with access to the process it uses to evaluate whether it will provide a favorable recommendation for shareholder approval of equity compensation plan proposals. Historically, Glass Lewis has been less than transparent regarding the actual criteria and methodology it uses to make its recommendations on equity plan proposals. Companies and investors will…
Proxy advisors (e.g., Institutional Shareholder Services (“ISS”) and Glass, Lewis & Co (“Glass Lewis”)) have played a substantial role in the design of executive compensation for many years. This has been due to the strong reliance of institutional investors (as well as investment advisors) on the proxy voting recommendations of firms such as ISS and Glass Lewis. Some commentators have viewed the proxy advisors as being quasi-regulators without any formal oversight of their potential conflicts…