Investors, companies adapting to crisis stewardship

A group of 20 institutional investors managing $7 trillion in assets are sharing guiding principles for managing their stewardship responsibilities amid the coronavirus pandemic, in guidance released Friday by SquareWell Partners in London.

The guidance covers expectations for communication, dividend payments, executive pay, annual general meetings and more. So far, the investors expect some delay in research from proxy advisory firms and plan to defer to regulatory guidance on annual meetings, including any decisions to postpone them.

Investors also expect less focus on executive pay and more on pressing business issues, but note that companies should manage reputational risks on pay in light of falling employment.

ESG will still matter to the investors and for certain sectors will become even more prominent. "Investors are convinced that E&S factors remain fundamental, not secondary," SquareWell found.

SquareWell also is tracking how companies are responding to the current crisis when it comes to financial guidance, dividends and buybacks, executive pay, and social initiatives. As of March 26, more than a third of U.S. and European Fortune 100 companies have communicated to the market how the COVID-19 crisis is impacting financials, executive pay, and annual general meetings, and nearly a quarter of the those companies have communicated a decision on their dividends.