Preliminary Planning for the 2016 Proxy Season

by Stinson Leonard Street - Dodd-Frank and the Jobs Act

Some will want to start preliminary planning for the 2016 proxy season.  It has been a bewildering year of developments, but most will be thankful that there are relatively few new rules that must be implemented at this time.  Nevertheless, it is helpful to catalog everything that is out there.

D&O Questionnaires:  The first question we get asked this time of year is “do we need to update D&O questionnaires?”  For most, the answer is no if you have kept up your form. There are no new independence rules and the like.

New ISS Policies:  ISS makes its move late in the year when announcing new policies so this is probably the biggest unknown.  If you want an idea on what ISS may have up its sleeve, review their recent policy survey, which usually drives their policy update.

Director Equity Grants: If you are putting a new equity plan on the ballot, consider including a sublimit for grants to directors.  The reason is to avoid the outcome in Valma v. Templeton et al, where the court refused to grant a motion to dismiss because the grants were subject to an entire fairness review.  Others may wish to amend their plans to provide for a sublimit and obtain shareholder approval.

SEC Rule 14a-8(i)(9) Review:  The SEC announced it would review its rule regarding exclusion of directly conflicting shareholder proposals after it reversed course and did not permit Whole Foods to exclude a proxy access proposal.  I wouldn’t be surprised if the SEC announces something before year end.  If they don’t, it’s likely that they will not grant no-action relief in the coming year under Rule 14a-8(i)(9) until they resolve the matter.

Proxy Access:  Yes, proxy access will be a hot topic again this year. Issuers may want to begin to consider options in the preliminary planning phase.

Pay Ratio Rules:  Final pay ratio rules have been adopted but have no impact on the 2016 proxy season.  The reason is public companies do not have to comply with the final rule until the first fiscal year beginning on or after January 1, 2017. For the most that means the pay ratio will first be presented in the 2018 proxy season.

Clawback Rules:  The clawback rules are still in the proposal stage and are not expected to be finalized before year end.

Pay Versus Performance Rules:  The pay versus performance rules are still in the proposal stage and are unlikely to be finalized before year end.

Hedging Disclosures:  While the SEC adopted proposed hedging disclosure rules early in 2015, the rules have still not yet been finalized.

Audit Committees:      There are no proposed rules on new audit committee disclosures and this is at the concept release stage.  Anything new here is a long way off.

Resource Extraction Disclosures:  Initially these rules were invalidated and the SEC was recently order to complete them, but nothing is on the horizon near term.

Conflict Mineral Rules:  While many would not consider this a proxy season item, the conflict minerals rules were again found unconstitutional after a rehearing.  No word from the SEC on next steps.

Say-When-On-Pay:  Issuers must hold a say-on-pay frequency vote every six years.  For most public companies that will be 2017.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Stinson Leonard Street - Dodd-Frank and the Jobs Act | Attorney Advertising

Written by:

Stinson Leonard Street - Dodd-Frank and the Jobs Act

Stinson Leonard Street - Dodd-Frank and the Jobs Act on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.