As part of its 2013 Policy Updates, ISS is revising its methodology for determining the peer group used to perform its quantitative pay-for-performance evaluation. In determining a company’s peer group, ISS’s new methodology will incorporate information from companies’ self-selected pay comparison peer groups, as disclosed in the proxy statement. ISS recognizes that some companies may have modified their peer groups since their most recent disclosure or may intend to do so in the preparation of their 2013 proxy statements.
In order to ensure that the most accurate and up-to-date information is incorporated into ISS’ peer group selection process, ISS is offering companies an opportunity to proactively inform ISS of any changes to a company’s self-selected peers by submitting updated peer group information to ISS by December 21, 2012. The peer group provided to ISS should generally be the peer group used for CEO pay decisions in 2012. However, ISS has noted that if changes have been or are anticipated to be made to the peer group for 2013 pay decisions due to business events that have made companies in the 2012 peer group no longer relevant (e.g., significant business changes, mergers, spinoffs or bankruptcies), the 2013 peer group information can be provided (which information should match the disclosure in the company’s 2013 proxy statement). Action is not required if a company has not made or does not intend to make any changes to its previously disclosed peer group, or does not want to provide this information in advance.
If a company wants to provide updated information, ISS has set up a web form to collect the information, which form is available at www.issgovernance.com/PeerFeedbackUS.
Posted by: Sean Feller