Glass Lewis Changes Policy on Virtual Meetings

Glass Lewis Changes Policy on Virtual Meetings

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Given the current COVID-19 crisis and the difficulty of having large, in-person meetings, many companies are considering or have decided to have their annual meeting be done this proxy season in a virtual format to help protect the health of everyone in attendance. Until Glass Lewis issued this update on March 19, 2020, its policy was to recommend Governance Committee members who approved a company’s virtual meeting.

However, recognizing the challenges presented by COVID-19, Glass Lewis issued an immediate update to its virtual meetings policy. Under Glass Lewis’ revised policy, Glass Lewis will review virtual meetings on a case-by-case basis. Glass Lewis will be noting whether a company indicates its intention to resume holding in-person or hybrid meetings under normal circumstances. This revised policy will be effective for shareholder meetings from March 1, 2020 through June 30, 2020.

Glass Lewis also offered an example of a company that handled switching to a virtual meeting format correctly, Starbucks Corporation. Starbucks issued an announcement about its change to a virtual meeting for its 2020 annual shareholders meeting on March 4, 2020, available at: https://www.sec.gov/Archives/edgar/data/829224/000119312520060980/d104351ddefa14a.htm

Note: Starbucks did not specifically indicate that it intended to return to its normal in-person meetings once the crisis is over.

I know several companies have been re-tooling their proxy statements to allow them to make their annual meeting a virtual meeting if necessary. To those companies, if they still have time, they may want to include a statement about their intent to return to an in-person meeting format once the COVID-19 crisis passes if a virtual meeting is used.

Glass Lewis’ announcement about the immediate change in its policy can be found in its blog post, Immediate Glass Lewis Guidelines Update on Virtual-Only Meetings due to COVID-19 (Coronavirus), available at: https://www.glasslewis.com/immediate-glass-lewis-guidelines-update-on-virtual-only-meetings-due-to-covid-19-coronavirus/

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