ISS Announces Results of 2025 Global Benchmark Policy Survey

On September 22, 2025, ISS published the results of its latest Global Benchmark Policy Survey (link). The survey is performed annually and is intended to gather feedback by ISS in developing its global benchmark policies. Per ISS, for this year’s survey, there were 248 participants, which includes 165 investors and investor-affiliated organizations (compared to 199 investor participants last year), and 83 non-investors (compared to 126 non-investor participants last year).

The following is a summary of the compensation-related items in the Benchmarking Survey and the investor responses to those items:

• Time- Versus Performance-Based Equity Awards (All Countries; U.S.).  Based on recent trends and feedback from some in the investor community, ISS included a series of questions focused on the use of time-based equity vehicles for part or all of executive long-term equity awards. Feedback suggested that there is meaningful support for a mix of time- and performance-based awards. Specifically, when asked if time-based awards are acceptable for part or all of executive equity programs, 38% of investor respondents chose “Yes, but only for part of the awards; plans should provide a mix of time-and performance-based awards.” A close second for investors (31%) was the option that “It depends. The adoption of time-based equity compensation with an extended time horizon may be acceptable for certain industries or due to specific factors disclosed by the company.” The survey also asked respondents what might count as sufficient long-term vesting or retention periods in place of performance requirements. Almost half (46%) of investor respondents chose “At least 5 years vesting and/or post-vesting retention requirement in aggregate (for example, 3 years vesting plus 2 years post-vesting retention).” Investor responses did not indicate a favored mix of time- versus performance-based awards. For the U.S. market, 31% of investors chose the following response when asked what would be considered a sufficiently long-term design to dispense with performance requirements “Three-year vesting plus at least a two-year post-vesting retention requirement,” while 41% of investors indicated that “100% retention of net shares for the specified time period” would be considered a meaningful stock retention requirement for after tax shares.
• Say-On-Pay Responsiveness (U.S.).  When evaluating a compensation committee's responsiveness following a low say-on-pay vote support, ISS carefully reviews the company’s proxy disclosure of shareholder engagement and feedback. However, recent SEC guidance¹ may have the effect of constraining certain institutional investors from engaging with companies and/or providing feedback. The survey asked how should ISS view this potential engagement curtailment in the context of say-on-pay responsiveness. 64% of the investors chose “The absence of disclosed shareholder feedback should not be viewed negatively if the company discloses that it attempted but was unable to obtain sufficient investor feedback.” Additionally, with respect to how ISS should assess whether pay program changes are in fact responsive to shareholders' feedback, 80% of investors chose “Yes, pay program changes, when showing improvement in remuneration practices, can be considered responsive, even in the absence of disclosed shareholder feedback.”
• Modification or Removal of ESG/DEI Metrics in In-Flight Awards (U.S.; Canada).   ISS and many investors have historically viewed changes to in-flight awards negatively, unless a company has disclosed a compelling rationale for the action. When asked how ISS should assess the removal of ESG/ DEI-related metrics from in-flight awards, 73% of investors chose: “Continue with the current approach, whereby changes to in-flight awards are generally viewed negatively absent a compelling rationale.”
• Non-Employee Director Pay (U.S.).  Under its current policy, ISS will typically make adverse vote recommendations after two consecutive years of outlier director pay (or other problematic director pay practices). ISS asked in the survey whether there are problematic director pay practices that would warrant immediate concern and a potential adverse recommendation even if it only occurs in one year. The following three director pay topics each received a similar investor response level (about 30-35%): “Inadequate disclosure or lack of clearly disclosed rationale in the proxy for unusual NED payments,” “Excessive perquisites (such as travel), performance awards, stock option grants, or retirement benefits,” and “Particularly large NED pay magnitude or NED pay that exceeds that of executive officers.” The other two choices were “No” and “Other,” and they received about 1% and 0% of the responses, respectively.

ISS has indicated that key draft policy updates will be released in the coming weeks and will be followed by an open public comment period, with final policy updates expected to be announced around late November (effective for shareholder meetings occurring on or after Feb. 1, 2026). FW Cook will be following all ISS releases and providing key updates and observations to our clients.

¹Broadly, the new SEC guidance provides that engagement on executive compensation issues with the purpose of influencing control over the issuer may disallow an institutional investor to file as a passive investor and instead require the investor to file as an active investor, which comes with more onerous requirements.

Dina Bernstein
Principal

Dina Bernstein has extensive experience advising on all aspects of executive compensation, working with companies on an ongoing basis, as well as in the context of mergers and acquisitions, spin-offs, initial public offerings, and other corporate events. Dina provides guidance to private and public companies across various industries regarding cash and equity incentive compensation arrangements, employment, severance and change in control agreements, overall compensation program design, pay governance practices, taxation, stock exchange listing requirements and securities regulation compliance.

Bindu M. Culas
Managing Director

Bindu Culas has over 20 years of executive compensation experience. She works across industries with domestic and foreign public companies, pre-IPO companies and privately-held companies. She has deep expertise in designing annual and long-term incentive programs, structuring equity plans and award vehicles, navigating talent attraction, motivation and retention challenges through business cycles, and advising on governance and investor considerations. Previously, Bindu was a partner at Linklaters LLP and she is well versed in the complex regulatory, compliance and tax aspects of executive compensation.