Shearman & Sterling LLP Shareholder Engagement | 15
FAST FACTS
Why Engage?
While companies generally engage in order to develop a two-way
communication process with their shareholders, the specific
reasons companies give for engaging can shed some light on
their engagement philosophy. About half of the Top 100
Companies disclosed why they engage with shareholders.
Engagement is about building mutual relationships between
company executives and board members and key shareholder
representatives. Relationships developed during an ongoing
shareholder engagement process can be utilized when difficult
issues arise in order to obtain input on future actions being
contemplated by the company.
To provide visibility and transparency into the
company's business and governance practices
1
To ensure that management and the board
understand and consider the issues that matter
most to the company's stockholders
2
To ensure that the company's corporate governance
practices continue to evolve and reflect the insights and
perspectives of the company's various stakeholders
3
To build and manage long-term relationships with
shareholders based on mutual trust and respect
Because effective board-shareholder
communication strengthens the board's role as
an active, informed and engaged fiduciary
4
5
Reasons companies engage with shareholders:
50
27
43
13
7
53
21
23
30
7
Many companies made
disclosures in more than one
of the sections listed above:
A variety of approaches were
taken by companies with respect
to where in their proxy
statements they made shareholder
engagement disclosures.
CD&A
Corporate governance section
Both CD&A and corporate
governance section
Proxy statement summary
Cover letter accompanying
the proxy statement
Say-on-pay proposal
5 sections
3 sections
2 sections
1 section
