Institutional Shareholder Services will recommend that its clients support non-binding proposals requiring directors to receive a majority of votes to be elected to the board.
Under the plurality proxy-voting structure, a board-backed nominee in an uncontested election needs only a single affirmative vote to claim a seat on the board, "even if holders of a substantial majority of shares withhold support for the nominee," according to an ISS statement, announcing the policy today.
Under a majority-vote proposal, "the failure of a nominee to receive majority support would necessitate action by the board," the statement noted.
ISS had no previous policy on the issue.
