This webcast featured a panel of experts discussing investor expectations and engagement during the COVID-19 crisis and beyond. Key takeaways included:

• Impact of pandemic on engagement and voting. During the current proxy season, investors are mostly focusing on 2019 performance when making voting decisions, but their views can be affected by how the company is dealing with the pandemic today.

• Increased focus on ESG. Investors understand the unprecedented pressures that companies are facing, so they want to give companies flexibility when it comes to responding to the pandemic, but that is not lessening focus on ESG issues. 

• Executive Compensation. Now is probably not the time for companies to be focusing on adjusting 2020 performance metrics for executive compensation – it’s too early to do so when we don’t know the full impact of the pandemic. When it does come time to consider adjusting 2020 performance metrics, companies should not seek to eliminate the impact of the COVID-19 crisis.

• 2020 Off-season Engagement. When preparing for off-season engagement, companies should look at what they’ve told their investors about their governance, succession planning, business continuity, and sustainability efforts in the past – and use that as a baseline to have an open conversation with investors as to what worked, what didn’t, and what lessons were learned.

• Capital Allocation. Investors continue to look at decisions about capital allocation and shareholder rights plans on a case-by-case basis. There isn’t, by any means, blanket opposition to share repurchases or dividends, but there may be extra scrutiny for companies that accept government assistance.

• Virtual Meetings. While the forces leading to the use of virtual annual meetings may lead companies to continue to use virtual annual shareholder meetings, companies may face some questions from investors if they too-tightly controlled the discussion at this year’s virtual or hybrid meetings.