China 2015 Proxy Season Preview


  • The meeting concentration for the 2015 China proxy season will be similar to that of the 2014 season. Peak months are expected to be April and May.
  • The number of EGMs covered by ISS increased substaintially in 2014, mainly driven by policy or regulatory changes.
  • The government has been endeavoring to improve the protection of minority shareholder interests in view of the concentrated shareholding structure in China. Its latest efforts include making online voting and disclosure of minority shareholder voting results mandatory for listed companies.
  • Political leaders are now banned from assuming a role outside their office concurrently, resulting in an unprecedented wave of resignations of independent directors.
  • ISS introduced changes to its policies regarding director elections:
    • In the case that an independent director candidate fails to meet ISS classification for independence, ISS will generally no longer oppose the candidate as long as the board independence level meet the one-third regulatory requirement;
    • ISS will look at the attendance of independent director nominees instead of all the director nominees and cut the look-back period to the most recent year from the most recent two years;
    • ISS will generally recommend against all non-independent director nominees up for election where the board is less than one-third independent, except for a CEO, managing director, executive chairman, or company founder whose removal would be expected to have a negative material impact on shareholder value.

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