Filing Proxy – A company must file its definitive proxy materials with the Securities and Exchange Commission at least 30 days in advance of its shareholder meeting date to participate.
Portal Opens – Within approximately 12 business days of filing a company’s definitive proxy materials, ISS will notify the company by email that its data is available for verification.
Company Verification – Within just two business days, the company (and not its advisors) must verify the equity plan data and/or request modifications. ISS will make the data available for verification at 9:00 a.m. Eastern Time on day one of the verification window, and will close at 9:00 p.m. Eastern Time on the following business day.
ISS Response – Within approximately five business days, ISS will provide a response to any request for modification.
As part of its announcement of this portal, ISS included Frequently Asked Questions (FAQs) providing more detail on the equity plan data verification process and a list of 27 questions in Appendix A of the FAQs to summarize what aspects of equity compensation plans ISS is reviewing. The FAQs are available here.
Given the confusion and potentially adverse consequences that may result when a published voting recommendation with respect to an issuer’s equity plan proposal is based upon incomplete or inaccurate information, and the influence of proxy advisory firm recommendations generally, issuers should consider taking advantage of this portal. However, to take advantage of this portal, a US company will need to file its proxy statement at least 30 days in advance of its meeting date, be on alert for email notifications from ISS and be prepared to act—and act—promptly during the short window for modification requests. If a US company currently contemplates including an equity plan proposal on its agenda for its next shareholder meeting, it should consider registering with ISS now and reviewing the list of questions in Appendix A of the FAQs.