Glass Lewis (GL) shared last Thursday more of its perspective and outlook of the effect that the coronavirus (COVID-19) pandemic may have on corporate governance for the 2020 proxy season. GL explains that it is issuing further updates because “it is important to provide the market with certainty and transparency on [GL’s] established approach” given that it believes that all governance issues and most proposal types will be impacted by the pandemic. Anticipating that the pandemic will continue for up to 18 months, GL states that the proxy advisor is monitoring the markets; the sentiments of institutional investors and shareholder proponents; disclosures by public companies; and the approaches and actions of public companies. GL has been communicating its public updates, observations and perspectives through its blog, including the recent update of its virtual meetings policy in the 2020 policy guidelines, and its regularly updated note on the COVID-19’s impact on annual shareholder meetings in the markets globally.
GL predicts that companies with stronger boards and governance practices will fare better during and after the pandemic than those without. GL writes that “[u]ltimately, the ability of boards and management to successfully navigate the crisis and outperform their competitors will highlight the stark differences in the effectiveness of boards, directors and their governance structures.”