NEW YORK—International public relations firm Fleishman-Hillard is partnering with proxy solicitation and investor intelligence specialist Georgeson to create a new offering called Corporate Governance, designed to help companies identify any performance or corporate governance issues that could influence their institutional shareholders’ investment decisions and proxy voting, as well as impact their corporate governance ratings.
CGI provides both a qualitative and quantitative analysis of a company’s top institutional investor base. The analysis includes an in-depth investor perception audit that measures how a company’s institutional investors view a company’s performance, management and corporate governance issues. CGI also analyzes a company’s top institutional holders to determine voting authority and historical voting patterns on key corporate governance issues.
The analysis is designed to help a company develop a focused investor communication strategy that anticipates and deals with institutional investor issues more proactively, rather than reacting to investor concerns after a surprising negative proxy vote.
“With investor disillusionment at an all time high, we anticipate this year’s proxy season to be the most scrutinized in decades,” said David Drake, managing director of Georgeson Shareholder.
Says Peter Verrengia, senior partner and head of Fleishman’s corporate credibility advisory practice, “Now is the time for corporate executives to make sure they really know what their institutional shareholders think of a company’s management, Board of Directors, corporate governance policies and overall performance. The last thing a company needs to find out through a proxy vote is that they have lost the confidence of a major shareholder.”
The new product will also help companies deal with corporate governance valuation tools launched by organizations including ISS, GovernanceMetrics, S&P and Moody’s, which are reviewing companies’ proxy statements, bylaws and board practices to gauge the merits—in their opinion—of these companies’ governance practices.
“Regardless of whether these ratings are empirically sound or intrinsically valuable, companies will now have to consider their governance ratings when preparing for an investor meeting and especially a proxy vote,” said Drake. “Some institutional investors are already incorporating these governance scores in the investment screening process.
“Georgeson Shareholder and Fleishman-Hillard have studied the ranking methodologies and have developed a rankings primer which will be provided as part of CGI.”
The complete CGI analysis can be done in six to eight weeks.