Mergers and acquisitions

Search by topic:

Activism Bonds Directors ESG Family Owned / Non listed companies General Meetings / Proxy solicitation Governance Investor Engagement IPO IR Convergence Issues for companies in 2019 Mergers and Acquisitions Mutual funds/ETFs Proxy Updates Recent Deals and Transactions Regulation / Reform Remuneration Shareholder Activism Shareholder Communication Shareholder Engagement Succession Planning

Latest posts

11 Feb 2019

INSTITUTIONAL INVESTOR SURVEY 2019

Morrow Sodali

Institutional Investors with assets under management of USD 33 trillion continue to want more information from portfolio companies about board composition and business strategy and ...

15 Mar 2019

Emerging Corporate Governance Trends for 2019 – A Global Perspective

Morrow Sodali

On March 14th , Deutsche Bank Depositary Receipts hosted a webinar on the most important issues and investor views on the upcoming AGM season as outlined in Morrow Sodali’s 4th Annual...

06 Nov 2018

Morrow Sodali opens a new german office under the leadership of Andrea Bischoff, Mandy Offel and Petra Becker

Morrow Sodali

Morrow Sodali has announced that Andrea Bischoff, Mandy Offel and Petra Becker have joined the firm to open a new branch in Frankfurt, Germany. The German team, representing Morrow ...

09 Aug 2018

Morrow Sodali bolsters corporate governance expertise with the appointment of Jana Jevcakova

Morrow Sodali

Morrow Sodali has further strengthened its position as Australia’s leading Shareholder Engagement and Corporate Governance Advisory firm following the appointment of prominent ...

12 Feb 2018

Board effectiveness, the focus of investors

Expansion

On Monday, February 12, Expansión, Spain's leading business and finance newspaper, published an article covering Morrow Sodali’s Institutional Investor Survey 2018, highlighting the ...

01 Feb 2018

Institutional Investor Survey 2018

Morrow Sodali

Institutional Investors with assets under management of USD 31 trillion want more detailed disclosure from portfolio companies about their boards of directors, business strategy and ...

07 Dec 2017

Activist Insight 2017 Intermediary Awards: Morrow Sodali moved up three places to third

Activist Insight

The 2016 merger of Morrow & Co with Italian shareholder services firm Sodali created a global proxy solicitation powerhouse that went on to acquire Australia’s Global Proxy ...

11 Sep 2017

Morrow Sodali appoints Grace Chan as Director of Business Development Australia

Morrow Sodali

Grace Chan has joined Morrow Sodali as Director of Business Development. Grace will support the Company’s growing portfolio of ASX listed clients, including developing key ...

05 Sep 2017

Morrow Sodali appoints Charles A. Koons as Managing Director, Activism & Contested Situations Advisory Group

Morrow Sodali

Charles A. Koons has joined Morrow Sodali as Managing Director of its Activism & Contested Situations Advisory Group. Charlie will provide strategic counsel to clients on a variety of ...

21 Mar 2017

Morrow Sodali acquires majority interest in GPS and expands into Australia

Morrow Sodali

We are glad to announce that Morrow Sodali acquired a majority interest in leading Australian proxy solicitation and corporate governance firm Global Proxy Solicitation (GPS), expanding...

Latest Posts

11 Feb 2019

INSTITUTIONAL INVESTOR SURVEY 2019

Institutional Investors with assets under management of USD 33 trillion continue to want more information from portfolio companies about board composition and business strategy and sustainability related topics, according to Morrow Sodali’s annual Institutional Investor Survey, released today. The survey highlights several areas of concern for investors looking ahead to voting proxies at 2019 annual shareholder meetings:

Clear articulation of a company’s business strategy and goals;
Directors’ skills, qualifications, experience and individual contribution to the effectiveness of the board;
Detailed business rationale for board decisions and their alignment with strategy and financial performance;
Climate change, the leading sustainability risk factor.

The Morrow Sodali survey, the fourth of its kind, was conducted in December 2018. Forty-six global Institutional Investors, with USD 33 trillion of assets under management, responded to the survey.

Survey respondents also indicated that:

The quality of governance policies and practices still plays a pivotal role when investors make voting decisions;
Investors are concerned that quarterly reporting can promote short-term behaviour by companies and investors, and, further, that quarterly reporting can lead to excessive reliance on earnings guidance;
Investors will increase their focus on board composition and accountability;
Companies can expect more focus on disclosure and increased dialogue around climate change strategy;
Executive pay may be the subject of collective engagement efforts by institutions during the Annual General Meeting season;
Activist campaigns with a credible story focused on long-term strategy are likely to gain investor support when companies have an unclear business strategy.

Kiran Vasantham, Director of Investor Engagement, said: “This survey provides issuers with valuable insights on investor expectations and voting policies. It is a bellwether for all companies as we enter the 2019 Annual Shareholder Meeting season. I am delighted so many investors took part in the survey, as it provides an important overview of asset managers’ priorities on a broad spectrum of ESG issues.”

To download the attachment and read the entire survey, please click here.

22 Apr 2019

Director Strangelove or: How I Learned to Stop Worrying and Prepare for Shareholder Activism

There is no debate that over the last decade shareholder activism has grown into its own animal. Rarely does an activism panel conclude these days without one of the panelists mentioning that activism has become its own asset class, which at this point is as clichéd as pointing out that no company is immune to pressure from an activist. A simple Google News search for “proxy fight” will take you down a rabbit hole from which you may never emerge. This growth in activism awareness has spawned a massive increase in various advisors, all of whom claim that they possess the key knowledge to best guide the Board and management, and yet lost in all of this is the corporate issuer’s perspective on what it all means to their unique situation.

Every advisor wants the Board and management team’s ear on how they can help with institutional shareholder engagement, often times because they have some valuable piece of “inside information” on how these institutional holders think. Many corporate issuers have lined up advisors across multiple areas of expertise for their “in case of emergency” or doomsday scenario. While I believe that it is critical to have such a plan in place, I feel many corporate issuers fail to take the proper next step, which is to understand how shareholder activism, or a proxy contest would play out at their specific company.

Taking that next step is the answer to any issuer’s most frequently asked question: How can we best prepare to deal with the threat of activism?

I believe an effective response to shareholder activism must be based on a firm understanding of four key factors:

A complete analysis of the issuer’s shareholder profile from a voting control perspective.
The l complexities of proxy solicitation mechanics in a contested director election versus a standard annual meeting.
A detailed cost analysis of running a contested campaign from both company and activist perspectives.
A regularly updated solicitation action plan that demonstrates a path to victory.

The Shareholder Profile

First, it is important to remember that your shareholder profile is ever changing. Understanding who and how many shares can be voted at any given time is the foundation for every activism defense plan. To that end, conducting regular studies of your top institutional holders and making necessary adjustments for stock loans, sub-advisory relationships, and short selling are critical. Once voting control is established, it is important to review the institutional holder component to determine the degree to which of the top holders are influenced by one of the proxy advisory firms, or whether they make voting decisions based on their own internal proxy voting policies or guidelines.

Next, it is important to establish the retail ownership profile. While this portion of a company’s shareholder profile typically votes less than a third of the time, they are most often supportive of the company when they do cast a vote. The vote from this category is never more critical than when a company finds itself in a close vote. Establishing who your top retail holders are and conditioning them to vote is an exercise that issuers should never neglect.

Once the voting control profile is created from an institutional and a retail perspective, we can then create a scorecard to track various outcomes. The Board and management team should be briefed with this type of review often, perhaps quarterly, as it is a good insurance policy against the threat of activism.

The Mechanical Complexities

Most corporate issuers have a consistent year over year plan for how they complete all the necessary tasks leading up to an annual meeting of shareholders. Those tasks are often divided among several team members across the legal and IR departments. Many issuers also retain outside mail and tabulation houses to complete mailings efficiently.

This strategy works well for a standard annual meeting where the issuer conducts one mailing to shareholders and perhaps a targeted follow-up mailing prior to the meeting date. However, in a contest for board seats, it is critical for the Board and management to understand that all these decisions are now strategic ones. The approach for completing these tasks should no longer be on auto-pilot as there can be undesirable and costly repercussions for using the year over year plan.

In a proxy contest, the Board and management team should expect as many as four or five mailings to shareholders, each with another voting instruction form or proxy card and a letter to shareholders. The dissident campaign will likely produce a similar number of mailings. At the end of the contest process, your shareholders will likely receive eight to ten proxy cards between both campaigns.

The contested nature of the solicitation also means that the Board and management team will need to spend significant time lobbying top shareholders for their support.

The Cost Analysis

If you think the cost of a standard annual meeting is high, then you might want to sit down before looking at your proxy contest bill. The last ten to fifteen years has seen many issuers changing their annual meeting approach to reduce the cost of mailing and tabulation. The rise of notice and access, moving away from elaborate annual reports and mailing packages, and the push for electronic voting have all contributed to the reduction of annual meeting costs. Most issuers can effectively stay within the expected budget for a standard annual meeting.

In a proxy contest, however, those budgets need to be drastically revised. Conducting a share range analysis of the issuer’s profile to determine the number of shareholders and shares within certain target ranges is an important evaluation. From that analysis it is possible to calculate the potential cost of the various mailings and advise the Board and management team on what to expect from a budgeting perspective. This should be done well in advance of a potential threat of shareholder activism.

The Solicitation Plan

Once the Board and management team have a firm understanding of the shareholder profile, the mechanics of a proxy contest, and the cost of the contested meeting, they should focus on the strategy and necessary steps for best soliciting their shareholder base. Experience shows that preparation during peace time is the best way to lay out a solicitation plan if faced with a proxy contest.

It is important for the Board to select the best representatives to communicate with shareholders during a proxy contest. They should understand that in addition to in person meetings and conference calls with institutional shareholders, board members will also be presenting their case to proxy advisors directly. They will also be involved in the writing and reviewing of shareholder letters that accompany each mailing. The contested annual meeting demands much more of a hands-on approach from the Board and management team than a standard annual meeting.

In proxy contests, the goal is to offer up an effective solicitation plan and to execute on that plan/timeline in delivering the vote. To achieve that goal, it is necessary to use all available information on the profile to effectively target unvoted holders and to demonstrate a path to victory for the Board and management team.

Reviewing all four key elements in times of peace will provide you with a strong level of understanding for how to deal with the threat of shareholder activism. The steps involved in being prepared act as an insurance policy against having to scramble after the threat has materialized. If you go through the steps necessary and no threat emerges, then we will all be smarter for having gone through the exercise and you can breathe a sigh of relief. Again, there is no need to worry, just be prepared.

15 Apr 2019

Planning Effective Engagement with your Investors

In addition to traditional Investor Relations roadshows focused on financial performance, companies and boards are now expected to conduct governance and sustainability roadshows that reach out to institutional stewardship teams as well as portfolio managers.

For issuers, these engagements require the commitment of significant resources internally, including valuable board time. For investors, the expansion of stewardship activities means that even for those who increased the internal resources (see our earlier piece on Stewardship Principles), the escalating demand on capacity is forcing them to be more selective and raise expectations on the content and quality of engagements.

Based on Morrow Sodali’s experience assisting companies with planning and organization of governance and ESG roadshows, we note factors that are key to successful engagements.

Clear objective

Starting with coherent strategic thinking internally, the company should define and communicate the objective of the engagement. It could be to showcase a new strategic direction, or developments in the business that are related to material ESG themes, or it could be part of an ongoing dialogue with investors about relevant issues. Historically, most roadshows were scheduled in anticipation of a forthcoming shareholders meeting, but we find that many shareholders are growing reluctant to take meetings – given that their voting policies are published in detail – purely on this basis, especially during the annual meeting season.

Mapping of shareholders

When the primary purpose of a roadshow relates to a shareholder meeting, whether to improve voting quorum or to canvass support, it makes sense to prioritize outreach by holdings. Companies should always consider investors’ voting policies and should follow up on issues raised during previous engagements. However, when the engagement agenda is focused on ESG developments, companies may wish to cast the net wider, and target those investors that are long-term oriented and known to be focused on these issues. The guiding principle here should be to speak with existing shareholders, but also reach out to targeted shareholders the company wishes to have (or wishes to own more stock).

Deciding who to speak with - location, team members

Many institutional investors are making efforts to link internally their investment and stewardship teams. Companies should reach out to both investment and stewardship teams, as appropriate, but it is up to the investor to decide who is best to lead a specific engagement. We recommend that companies do their homework and ensure they are including all the appropriate contacts and positioning the engagement campaign so as to make it easier for the investors to decide who should be involved.

A key question for companies is whether members of the board of directors should be involved and if so, which directors are needed to address relevant issues. In addition, should members of management be included or not? For example, on compensation issues, investors may want to talk primarily to board compensation committee members. In other cases, HR should be included. The demands on investor resources mean that increasingly they view it as important to have direct dialogue with directors (see our Institutional Investor Survey 2019 more on why and how to do this) as well as relevant members of the management team (e.g. HR representatives on issues of human capital management).

On a practical note, Morrow Sodali often come across companies who apply a strong home bias in targeting their investors. Our experience indicates that cross-border ownership is increasingly common even in controlled companies. In those cases, we recommend roadshow itineraries should include markets where investors are located (e.g. London, Paris, Netherlands), regardless of where the company is domiciled.

Extensive preparation

Evolving stewardship responsibilities and regulatory requirements mean that the information investors are publishing about their voting and stewardship policies is more extensive than ever. We recommend that companies conduct meticulous preparation in advance of meetings, and tailor the meeting agenda and materials to meet investors’ preferences. Because investors’ time and resources are limited, engagements should do more than rehash publicly stated positions. The goal is to conduct an informed and informative dialogue.

Anecdotal evidence shows that, at times, preparation is needed just to secure some meetings. At Morrow Sodali, we are aware that some of the large investors have updated their access processes to ensure that requests for engagement pass a threshold of demonstrating preparedness as a condition to them being considered.

Follow up

This is perhaps stating the obvious but thinking about the next meeting and the next engagement means that companies have to maintain credibility and follow up as agreed. For example, when a consultation process culminates in new proposals, it is important to go back to the relevant investors and communicate the rationale for the chosen course of action – i.e. even, and perhaps especially, if the company felt it was not able to fully adopt the preference of the particular investor(s).

Why this is important?

Executing an effective investor engagement draws on precious corporate resources including valuable management and board time. It is important therefore that companies fully consider the benefits. Most immediately, this includes strengthening of the relationships with long-term minded owners – those shareholders most companies would wish to have more of. Regular face-to-face meetings with investors can be a critical part of this. Additionally, with the current level of activism, we find that for some clients, especially in Europe, the ability to draw on support from long-term shareholders has been a key component of activism defense. More fundamentally, there are several pieces of academic research suggesting that engagement enhances value, presumably by enhancing communication and helping to close any possible disconnects between valuations and prices.

10 Apr 2019

5 key ways to better engagement with boards

Morrow Sodali has released its fourth annual Global Institutional Investor Survey which includes feedback from a third of the world’s assets under management representing $33 trillion gathered from 46 respondents, including several domestic funds.

The results confirm that 2019 will be another year of transformative change as investors step up engagement to better understand the alignment between board composition and business strategy, especially in the way the board oversees corporate culture and the ‘tone from the top’.

Increasing role of non-financial factors

In light of the report from the Hayne Royal Commission, these findings reinforce the increasing importance of non-financial factors in assessing a company’s performance and corporate behaviour.

Investors want to engage with boards regularly throughout the year and they also want more substantive information about board composition and business strategy. They want clearer explanations on governance and executive remuneration. They also want an integrated narrative that explains environmental, social and governance practices in terms of business risk and sustainable financial performance.

Many investors are moving away from box-ticking and compliance checklists which is good news for companies. It gives companies greater flexibility to explain policies in terms of their specific business conditions and strategic goals. But a deeper dive by investors into companies’ strategic decisions increases demands on the time and attention of directors, requires much greater transparency and needs to consider the continuous disclosure obligations.

Access the full article here: https://cuffelinks.com.au/5-key-ways-better-engagement-company-boards/

08 Apr 2019

Corporate Reporting

Corporate reporting in today’s environment is like a puzzle whose pieces are spread across the table waiting to be fitted together to form a clear picture. While disclosure rules and audit standards still dictate strict and relatively uniform financial reporting requirements, expectations for big-picture corporate reporting have become more complex and open-ended. This results primarily from the introduction into the company narrative of factors referred to collectively as “ESG” (environmental, social and governance practices) or “sustainability” (the ability to create value over the long term). Corporate reporting about these topics (which are sometimes characterized as “non-financial” or “extra-financial”) is now deemed by institutional investors -- and increasingly by issuers -- to be essential for an accurate picture of a company’s culture, risk profile, financial health and long-term outlook. While financial reporting at many companies is still largely a compliance exercise, how a company should “tell its story” now opens the door to nearly unlimited possibilities.

Here are some of the factors that are shaping and will continue to shape corporate reporting for the foreseeable future:

Investor demand for more detailed, substantive information about ESG and sustainability will continue to grow. There is no longer any doubt that environmental practices, social policies and corporate governance represent both risks and business opportunities that can have a substantial impact on a company’s financial performance. Recent high-profile corporate scandals have drawn further attention to the risks, confirming the materiality of ESG issues for the analysis of companies’ financial health and sustainability.
Investors, led by global index funds, have adopted stewardship principles and confirmed that their role as fiduciaries requires them to concentrate on the long-term performance of portfolio companies. They are demanding information relating to corporate purpose, corporate culture, human capital management and reputation management for their investment decisions, their oversight of portfolio companies and their proxy voting decisions.
Stakeholders, in addition to shareholders, now define the audience for corporate reporting. Stakeholders are company-specific, generally including customers, employees, suppliers and the communities impacted by the company’s business, including foreign operations. In addition, changes in shareholder demography, new technology and social media are expanding the audiences for corporate reporting, their means of access and their potential impact on the company’s business.
Academics and governance advocates are asking whether traditional financial audit standards are sufficient to present a complete picture of a company’s financial health and risk profile. The outcome of a debate at the Oxford Union in December 2018 supported the resolution that the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) should collaborate with the Sustainability Accounting Standards Board (SASB) to establish ESG reporting standards for corporations. In December 2018, the Australian Accounting Standards Board and the Auditing and Assurance Standards Board published a guidance statement entitled “Climate-Related and Other Emerging Risks Disclosures: Assessing Financial Statement Materiality.” This type of guidance is expected to increase disclosure of the financial implications arising from non-financial risk factors. Over time, audit firms’ decision to either stick with “pure financial reporting” or adopt “broader financial reporting” will have a lasting impact on corporate reporting globally.
Global standard-setting organizations such as SASB and GRI (Global Reporting Initiative) have already developed comprehensive sets of ESG metrics for use by both investors and issuers. In addition to serving as a potential basis for audit standards, the use of standardized ESG metrics allows for greater comparability among companies and industry peers.
The IIRC (International Integrated Reporting Council) is gaining support in countries around the world. Its seven guiding principles read like a framework for effective corporate reporting, with particular focus on stakeholder relationships, materiality and a holistic picture of the business enterprise. South Africa mandates integrated reporting and in Japan and Europe integrated annual reports (strategic reports in the UK) are increasingly common. A few companies in the U.S. also publish integrated annual reports. In addition, the IIRC has convened the Corporate Reporting Dialogue, whose purpose is “to strengthen cooperation, coordination and alignment between key standard setters and framework developers that have a significant international influence on the corporate reporting landscape.”
Regulators around the world are giving more attention to ESG/sustainability disclosure. The European Commission has strengthened the Shareholder Rights Directive and increased pressure on companies to improve the quality of explanations under the voluntary comply-or-explain governance regime. The EC has also issued regulations regarding the reporting of non-financial information. French companies publish specific information about their non-financial performance. In the U.S., a group of academics and investors representing $5 trillion in AUM submitted a petition to the U. S. Securities and Exchange Commission on October 1, 2018 specifically requesting rulemaking on ESG disclosure.

With the corporate reporting puzzle pieces still scattered, issuers in different markets have undertaken a variety of measures to meet investor and stakeholder demand for a more meaningful and complete picture of the business enterprise. Many companies now publish detailed reports on a variety of ESG topics such as Corporate Governance, Social Responsibility, Climate Change, Environmental Practices, Codes of Business Conduct, Strategic Vision and more. Separate reports, however, fall short of the ultimate corporate reporting goal of a narrative that combines and integrates financial performance, strategy, ESG policies and sustainability.

In the US, the proxy statement is often the vehicle for companies to address ESG issues. A number of progressive companies have introduced improved graphics and highly creative methods to make proxy statements more readable, more informative and more concise. Innovations such as the board skills matrix and summaries of complex topics such as executive compensation supplement required disclosures and help reduce reliance on boilerplate. A review of Morrow Sodali clients reveals how the design of corporate proxy statements continues to offer new and creative ways to present information clearly and effectively.

Issuers understand that corporate reporting is fundamental to their relations with shareholders and their preparedness to deal with market challenges. Companies are building internal resources and providing more information on ESG and sustainability. They are also working to increase internal collaboration and coordinate their communication strategies. Companies increasingly recognize that basic IR and shareholder relations activities such as ownership profiling, market surveillance, investor engagement, proxy solicitation, governance road shows, board evaluation and activism preparedness can help them understand both the audiences they serve and the issues they need to address in their corporate reporting.

Conclusion: When the dust settles, corporate reporting that fully incorporates material ESG and sustainability issues will be more detailed, more customized, more company-specific. It will be shaped by materiality standards that depend less on one-size-fits-all regulatory compliance and more on business fundamentals, market conditions and strategic goals. A communication regime that includes fit-for-purpose disclosures will enable each company to tell its own unique story.

04 Apr 2019

What impact investments mean for boards

Impact investing is making waves in the financial world. Based on the idea that asset managers invest “to positively contribute to social or environmental solutions”, the strategy has already attracted some big-name fund managers.

Financial writers and observers are quick to rave about impact investment and its growing importance. After all, it’s one of the fastest growing areas of the fund management industry and it is aimed at doing good. It’s good for business and reputations.

So what implications will this have for board members who have to answer to asset managers?

Boards interested in pleasing impact investors will need to be clear on two things, according to David Shammai, Morrow Sodali's cross-border director, corporate governance, knowing how the shareholders on your register are interested in impact investing; and how their reporting and disclosure activities would support a claim for impact capital.

He adds, however, that there is good news in the impact approach because it represents an “upside opportunity” for boards and shareholders alike.

“When you talk about traditional ESG [environmental, social and governance investing], it’s about optimising and controlling risk associated with non-financial factors,” says Shammai.

Access the full article here: https://boardagenda.com/2019/04/04/what-impact-investments-mean-for-boards/

01 Apr 2019

Stewardship Principles

Stewardship of assets by institutional investors is growing in prominence. This approach is supported by a multitude of market and internationally scoped codes or similar initiatives.

Vanguard, one of the world’s largest asset managers, is an example of a US-based institution that is at the forefront of this trend. David Shammai, Morrow Sodali’s Director of Corporate Governance- Cross Border, asked W. Robert Main III, Head of Portfolio Company Engagement, Analysis, and Voting at Vanguard about their stewardship program.

The growing volume of stewardship activity at Vanguard has been widely reported, but how has the program and the approach evolved?

As a long-term shareholder of publicly traded companies across the globe, Vanguard cares deeply about good governance and has continued to invest in our Investment Stewardship program. Since 2015, the team has doubled in size, and now stands at over 30 team members, including teams in both the United States and Europe. Though the team has grown, which has enabled us to broaden and deepen our advocacy, engagement, and voting activities, the core tenets of our program have remained consistent. Our approach remains anchored to our four principles of good governance – board composition, executive compensation, oversight of risk and strategy, and governance structures that empower shareholders.

How do you see the relation between your stewardship activity and the fiduciary duties you owe to the ultimate fund investors? Are they always complementary, for example in cases when there is an ethical dimension to a certain issue, would stewardship approach imply a more powerful imperative to gauge beneficiary preferences?

Our stewardship activity is directly tied to our fiduciary duty to our fund shareholders. At Vanguard our core purpose is, “To take a stand for all investors, to treat them fairly, and to give them the best chance for investment success.” One way we further this mission is through our investment stewardship efforts, seeking to maximize the long-term investments of our more than 20 million fund shareholders. Through our years of experience and research on a range of corporate governance matters, we have learned the relationship between ESG issues and long-term financial value is complex. That’s why our team uses the Sustainability Accounting Standards Board (SASB) framework to identify material environmental or societal issues by industry, which informs our engagement and voting approach.

What would be your advice to companies facing several issues here, some are to do with the increased resource that is needed to address investors’ growing appetite for engagement, but also having to cater to much more nuanced variations in the expectations of their investor base?

From our perspective, one element of good company governance is an effective engagement program with shareholders. However, we appreciate that increased demand from investors on a growing list of topics has created some tension with companies. Based on our engagements with more than 700 companies last year, here are a few takeaways from companies that are demonstrating leadership in their engagement practices:

Companies need to effectively communicate and coordinate internally to ensure the right participants are engaging with investors. This often involves discussions between the corporate secretary or general counsel’s office and with investor relations. For example, when investors seek to discuss topics like executive compensation and board oversight of strategy and risk, companies should expect to involve independent board directors in those discussions.
Before requesting an engagement, companies should do their “homework.” In other words, seek to better understand the principles, priorities, and investment approach of their key investors. Most investors make this information readily available on their websites, which should help companies to prioritize engagement and should inform discussions that do occur. If an investor’s policy or practice is unclear, companies should ask for clarification.
Companies should be prepared to discuss topics that are relevant to long term shareholder value creation. At Vanguard, when it comes to sustainability risks, companies should be prepared to discuss the industry risks highlighted by the SASB framework.

01 Apr 2019

SEC Comments on Proxy Process

In its latest Proxy Update, Morrow Sodali reports on the key points made by SEC commissioner, Elad L. Roisman, in his recent speech at the ICI Mutual Funds and Investment Management Conference.

Download the below attachment to access Morrow Sodali’s full publication.

29 Mar 2019

Dialogue with investors helps to protect against an activist attack

How to react to an attack by activist investors? A risk that rises, with 226 companies targeted in the world in 2018 (against 188 in 2017), including 25% in Europe, as Jean-Florent Rérolle, managing director at Morrow Sodali, reminded the audience during a conference organized by the French Society of Evaluators (Sfev), on March 29.

"Faced with this risk, companies must ask themselves whether their intrinsic value is linked to that of the market, reduce their vulnerabilities and engage in genuine dialogue with institutional investors to make them allies," continued Jean-Florent Rérolle. But, "in France, there is no real dialogue with the directors, some are poorly trained and poorly mastered the documentation of the company, which is often given at the last moment," explained Véronique Bresson, head of governance at Ciam, the French activist fund that has become known with the Club Med and Euro Disney and Scor files.

Download the attachment below to read the entire article.

05 Oct 2018

SENOMYX, INC. TENDER OFFER

Sentry Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Firmenich Incorporated, a Delaware corporation, is offering to purchase for cash all outstanding shares of common stock, par value $0.001 per share (the “Shares”), of Senomyx, Inc., a Delaware corporation.

Morrow Sodali is serving as the information agent for this transaction.

08 Jun 2017

Investa Office Fund

Investa Listed Funds Management Limited, the responsible entity of Investa Office Fund (ASX: IOF), announced a proposal to acquire a 50% shareholding on a joint venture basis in Investa Office Management Pty Limited. The vote to approve the proposal was held on 31 May 2017.

Morrow Sodali Australia served as governance advisor and proxy solicitor for Investa Listed Funds Management Limited.

Press area Morrow Sodali is hiring