On November 20, 2012, Glass, Lewis & Co. (Glass Lewis) released its 2013 proxy guidelines update. The guidelines cover a variety of topics, including:

The 2013 guidelines reflect a small number of changes from 2012, the most significant of which is Glass Lewis' evaluation of board responsiveness to a shareholder vote of 25% or more against the board's recommendation on a proposal.

Glass Lewis recommends that any time at least 25% of shareholders vote against the recommendation of management, the board should demonstrate some level of engagement and responsiveness to address the shareholder concerns. At this threshold, Glass Lewis will examine the underlying issues and evaluate whether the board responded appropriately after the vote. This includes instances when 25% or more of shareholders (excluding abstentions and broker non-votes):

While the 25% threshold will not automatically cause a negative vote recommendation from Glass Lewis on a future proposal, it will support an argument to vote against management's recommendation if Glass Lewis determines that the board did not respond appropriately.

The guidelines also highlight that, at companies that received a greater than 25% shareholder vote against their say on pay proposal in 2012, Glass Lewis will look for disclosure in the proxy statement and other public filings for guidance on whether the compensation committee is responding to the prior year's vote results, including by engaging with large shareholders to identify their concerns. If Glass Lewis does not see evidence that the board is actively engaging shareholders and responding accordingly, it will recommend holding compensation committee members accountable for a failure to respond, after considering the level of the vote against and the severity and history of the compensation problems.

The new guidelines take effect for shareholders' meetings that are held after January 1, 2013.