Board response to majority-supported shareholder proposals. For 2013, ISS made several revisions to its policy on board responsiveness to majority-supported shareholder proposals intended to strengthen accountability of directors who fail to respond to shareholder proposals. A key change was the announcement that a majority of shares cast on a shareholder proposal in one year triggers evaluation of a company's response to majority-supported shareholder proposals the following year (see Legal Update, Institutional Shareholder Services Releases 2013 Updates to its Proxy Voting Guidelines). The 2014 draft policies further clarify that:

Pay for performance quantitative screen. When evaluating a company's pay-for-performance alignment, ISS conducts an initial quantitative assessment to identify companies with a significant misalignment that merits a deeper qualitative review. Currently, when determining the Relative Degree of Alignment (RDA), ISS calculates the difference between a company's total stockholder return (TSR) rank and its CEO's total pay rank within a peer group over three-year and one-year periods (weighted 60% and 40%, respectively) (see Legal Update, Institutional Shareholder Services Updates White Paper on Pay for Performance). To better reflect long-term performance and to avoid distortion caused by volatility in the final year, among other purposes, ISS proposes to eliminate use of the one-year period, and to base the calculation on the three-year period alone (or as many full fiscal years that the company has been publicly traded and disclosed pay data).