Key players are ISS and Glass Lewis, the dominant proxy advisory firms influencing institutional investors. ISS updated policies on five compensation topics: quantitative pay-for-performance assessment, proportion of time-based vs. performance-based equity (favoring longer vesting for time-based awards), board responsiveness to low prior Say-on-Pay votes (offering flexibility for good-faith engagement), high non-executive director pay, and equity plan proposals (adding scored director limits and overriding negative factors).[1][5] Glass Lewis revised its pay-for-performance model to a weighted scorecard, clarified qualitative assessments (e.g., incentive structure, performance metrics, long-term payouts), and maintained a 50% performance-based long-term incentive expectation while softening strict enforcement absent other issues; it also addressed unrelated topics like mandatory arbitration clauses.[1][3][5]
Updates follow ISS proposals from November 2025 and Glass Lewis announcements from August 2025, shaped by investor feedback via surveys and roundtables amid SEC changes limiting shareholder proposal no-action reviews. ISS aimed to reflect shifting investor views on equity mix and engagement barriers; Glass Lewis emphasized nuanced, market-informed analysis, signaling its 2027 shift to client-customized policies over benchmark ones.[1][3][4][5]
Newsworthy on February 3, 2026, as final guidelines—timed just before the proxy season—guide imminent board preparations, say-on-pay disclosures, and voting amid evolving regulations and declining E&S proposal support. Companies face heightened scrutiny on compensation design, with potential impacts on director support and investor relations.[2][3][4]