Shearman & Sterling IPO Governance | 29
78%
94%
94%
97%
91%
19%
89%
94%
95%
90%
29%
23
92%
adopted an exclusive forum provision
provided that stockholders cannot remove directors without cause
provided that the board can increase the size of the board unilaterally
STATE OF INCORPORATION
Delaware continues to be the most
common state of incorporation among
IPO companies.
GOVERNANCE PRACTICES ADOPTED
BY IPO COMPANIES
In both 2015 and 2016, listings
were more or less evenly split
between NASDAQ and NYSE.
Based on the data, most of the companies surveyed in each year adopted
practices that ISS identifies as problematic. The data reflect a continued
pattern of IPO companies adopting aggressive anti-takeover measures
despite the new policy and recent voting actions taken by ISS.
In addition, many 2016 companies continued to adopt certain other
practices that may face ISS scrutiny in the future:
adopted a classified board
required a supermajority vote for certain amendments to the
certificate of incorporation
provided for plurality voting in uncontested director elections
did not provide stockholders with the right to call special meetings
did not provide stockholders with the right to act by written consent
had a multi-class equity structure
2016
2016
% incorporated
in Delaware
% incorporated
in another state
% incorporated
in Delaware
% incorporated
in another state
2015
2016
Note: Nearly half remained controlled
companies following the IPO.
Note: 72% remained controlled
companies following the IPO.
95%
5%
94%
6%
84%
92%
98%
84%
91%
97%
2015
2015
