Hot Topics, Trends, and Tips for Transforming Shareholder Relations in 2019

Some practical advice, cost savings tips, and details of the hot topics and trends in the field of proxy solicitation and governance advisory work: As a proxy firm, our business brings us in contact with the most influential institutional investors in the world and millions of individual investors each year, so we offer the following:

Practical Advice

• Know your shareholder profile by category and share holdings (institutional, retail, registered).

• Have up-to-date contacts at each institutional investor and know their voting policies.

• Shareholder engagement off the annual meeting cycle is now the norm (70% of S&P 500).

• Lead the conversation with the right people on the phone ( Legal, IR, HR).

• For critical proposals we advise calling institutions from the bottom up so questions/objections from smaller institutions will sharpen presentations to your largest investors.

• In call campaigns to retail investors do not hesitate to drop share range levels to gain support. Once a share range has been “dialed” multiple times it is time to move to greener grass in the form of shareholders who have not been solicited.

Cost Savings Tips

• Consider Notice & Access (N&A) if it is right for your shareholder profile and proxy agenda. • Utilize N&A only to certain shareholder groups or stratify by share range as an alternative.

• Consider combining 10K & PS into one, to consolidate printing and to provide “one pass” mailing.

• Reminder mailings to retail investors should not be via the old “Letter from the CEO”; but rather an oversize postcard with the use of imagery, color, call-out boxes and an 800 number to call: Higher response rates will eliminate calls and more than cover the additional print costs.

• Use Marketing Mail rate instead of First Class postage when ample time is built into schedule.

Hot Topics/Trends

• Today most governance issues have either been widely adopted or addressed through the shareholder engagement process, although resolutions calling for amendments to existing by-law provisions for proxy access will continue.

• Evolving views of institutional investors, particularly index funds, will bring Environmental and Social proposals to the forefront and will dominate the shareholder proposal landscape.

• Environmental issues include emissions reduction, sustainability reporting, reduce greenhouse gas, coal ash risk and climate change concerns.

• Social issues include board diversity, lobbying, political expenditures, the opioid crisis, drug pricing, gun violence and corporate culture.

• Board diversity and composition ( female and minority) are laser-focused issues for some institutions particularly BlackRock, SSGA and CalSTRS.

• Opposition to Virtual-Only meetings will continue with NYC Pension Funds at the forefront.