The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2021”.

Diversity has long been a focus for both companies and stakeholders, but 2020 in particular saw diversity come to the forefront of stakeholders’ agendas. Against the backdrop of the ongoing COVID-19 pandemic and its disparate impacts on human capital, alongside increased focus on racial equity and justice and related unrest, we have seen key players across the board push to broaden the scope and impact of diversity issues in the corporate space.

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For a PDF of the full memorandum, please click here.

The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2021”.

Corporate sustainability has in a few short years become a mainstream capital allocation and voting criterion for many institutional investors. As a consequence, those investors are calling for consistent, comparable and reliable sustainability disclosure capturing the risks and opportunities faced by the businesses in which they invest.

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The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2021”.

Following the celebration of the five-year anniversary of the Paris climate conference (COP21) in December 2020, Europe stands out as one of the leaders in developing policies that support the goals of the Paris Agreement, providing frameworks for companies and investors alike to redirect capital flows toward environmentally sustainable activities, as well as various mechanisms to alleviate the social impact of the transition to a greener economy.

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The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2021”.

For companies and boards managing crises or cross-border matters, the COVID-19 pandemic has brought unprecedented challenges that in many ways fundamentally change how we think of crisis management. However, managing through COVID-19 has illustrated the importance of many of the fundamentals that underpin good crisis planning and management in any environment: preparedness, transparency, engagement with regulators, clear and timely communications and proactivity.

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The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2021”.

The focus on environmental, social and governance (ESG) matters at public companies continues to grow despite, or perhaps in part because of, the COVID-19 pandemic. ESG continues to mean many things, including company considerations around sustainability, diversity, human capital, corporate purpose and governance. While best practices, disclosure requirements and ESG ratings are developing, boards should continue to prioritize ESG issues, particularly as they relate to long-term company strategy and risk.

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For a PDF of the full memorandum, please click here.

The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2021”.

In 2020, the COVID-19 pandemic, economic uncertainty, divisive politics and a historic social justice movement presented unprecedented challenges for boards. While the pandemic eliminated the concept of an in-person boardroom, as well as investor site visits, one-on-one meetings at conferences and strategy retreats, work did not slow, and most directors reported devoting significantly more time to their duties.

Boards stepped up to the challenge during the crisis, showing heightened awareness of and focus on environmental, social and governance (ESG) issues highlighted by the COVID-19 pandemic, such as company culture, human capital management, long-term strategy and executive compensation.

In 2021, maintaining and building shareholder relationships through effective engagement will be more important than ever as boards reflect on 2020 and plan for the future. Shareholders will likely be pushing companies to address strategy adjustments, changes in capital allocation and executive compensation in advance of the 2021 proxy season.

Below, we discuss what is motivating shareholders and considerations for companies and their board members in crafting and executing an effective strategy for communicating with investors and other constituents, during proxy season and the off-season.

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In 2020, many directors and members of senior management faced their most challenging year ever. Maybe the lessons of such a turbulent year will prove sufficient for 2021, but that seems unlikely.

To prepare this memo, we asked our colleagues in a wide range of disciplines to boil down what we learned from last year, and to look around the corner for what to expect in 2021. The result is a compendium of the trends and topics that will dominate board meetings this year. The following pages touch on many topics – including themes of sustainability and diversity that are now at the top of every corporate agenda; continuing changes in investor engagement strategies, across the spectrum from stewardship to activism; the impact of a new federal administration; emerging threats arising from new litigation strategies; and much more.

We invite you to review these topics by clicking here.

For a PDF of the full memorandum, please click here.

At the end of last year, Institutional Shareholder Services (“ISS”) released a handful of updated FAQs on equity compensation plans and compensation policies as well as a slightly updated pay-for-performance mechanics statement; there were no substantive changes to the peer group FAQs.[1] In addition to providing the 2021 Burn Rate Benchmarks for ISS equity plan evaluation (which are effective for shareholder meetings on or after February 1, 2021), the updates address questions regarding the inclusion of a terminated equity plan’s existing share reserves in ISS’ Shareholder Value Transfer (“SVT”) analysis for new equity plan approval proposals, threshold passing scores for the Equity Plan Scorecard (“EPSC”) framework, quantitative pay-for-performance screens and how ISS will evaluate COVID-related pay decisions. Continue Reading ISS Issues 2021 Updates to Certain Compensation Related FAQs and Policies

Over a year ago, on December 29, 2019, the Sustainable Finance Disclosure Regulation entered into force. Just a few months remain before key provisions begin to apply and asset/fund managers and other financial services firms should not delay in preparing for new disclosure requirements.

The SFDR requires European financial firms to consider how sustainability risks are incorporated into their investment decision-making processes, and the extent to which their financial sector remuneration practices are consistent with sustainability concerns. In short, manufacturers of financial products and financial advisers need to consider and adapt how they operate their business before they can make the disclosures required under the SFDR.

This alert memorandum provides an overview of the SFDR (including as to status, scope and conceptual and technical framework), explores the upcoming regulatory implications of this initiative for European financial sector firms, and provides a comparative analysis of similar regulatory developments in other jurisdictions.

On December 18, 2020, the Internal Revenue Service (“IRS”) issued final regulations (the “Final Regulations”) under Section 162(m) of the Internal Revenue Code (the “Code”), as amended by the 2017 Tax Cuts and Jobs Act (the “TCJA”). Section 162(m) limits the deductibility of compensation paid in any year to certain public company executives to $1 million. The Final Regulations provide further guidance on the TCJA’s amendments to Section 162(m) and are generally consistent with the IRS’ 2019 proposed regulations (the “Proposed Regulations”). Key changes from the Proposed Regulations and other clarifications are discussed in more detail below. The Final Regulations will apply to tax years beginning on or after December 30, 2020, with special applicability dates for specified provisions.

Please click here to read the full alert memorandum.