My last post was a re-posting of Adam Epstein’s great piece on the importance of the proxy statement. I promised that I would follow up on Adam’s thoughts with some recommendations of my own. Here goes.
- Manage your proxy statement “real estate” to maximize user-friendliness and create an optimal flow: Think about where things go. For example, if your company is owned largely by institutions (and perhaps even if it’s not), should you lead off with an endless Q&A about the annual meeting and voting, discussing such exciting topics as the difference between record and beneficial ownership and how to change your vote? Some of it is required, but consider taking out what’s not required and moving what is required to the back of the book.
- Use executive summaries: Investors like them, and even the SEC has more or less endorsed their use. Think of it this way – whatever you think of ISS, it does a great job of summarizing your key disclosures, albeit not with your company’s best interests in mind. Why pass up an opportunity to convey your key disclosures with those interests in mind?