Will refrain from recommending a vote against Nom/Gov committee members provided that the company’s rationale for holding a virtual meeting cites COVID-19

Glass Lewis announced today that for companies opting to hold a virtual-only shareholder meeting during the remainder of the 2020 proxy season  – March 1, 2020 through June 30, 2020 – it will generally refrain from recommending a vote against members of the governance committee on this basis, provided that the company discloses, at a minimum, its rationale for doing so, including citing the effects of the coronavirus (COVID-19).

Recognizing the growing worldwide disruption caused by COVID-19, and the accompanying concerns for the health and safety of employees and shareholders, Glass Lewis acknowledged the compelling advantages provided by virtual-only meetings under the current circumstances, and that discouraging virtual-only meetings during these times would not be in the best interests of shareholders or companies.    

The advisor also stated that it would note whether these companies state their intention to resume holding in-person or hybrid meetings under normal circumstances. Should these companies opt to continue holding virtual-only shareholder meetings in subsequent years, Glass Lewis expects future proxy statements to include the more robust disclosure detailed in its standard policy on virtual shareholder meetings, available here.

Finally, Glass Lewis intends to apply its standard policy on virtual-only meetings for all shareholder meetings occurring after June 30, 2020, believing that, even if the pandemic were to continue beyond this date, these companies will have had sufficient time to address the shareholder concerns outlined in its standard policy. Glass Lewis’ announcement comes on the heels of guidance issued by the SEC to provide flexibility to companies seeking to change their in-person shareholder meetings to virtual in response to the public health concerns related to COVID-19, previously discussed here