Historically, Ireland, France, Greece, Spain, Belgium, Russia, Poland, Bulgaria, the Czech Republic, Croatia, and Serbia have peaked in June, and preliminary data suggests that this pattern will hold for 2015, although not all June 2015 meetings have been announced yet. Several markets that traditionally peak in May, such as the U.K., Germany, and Sweden, will also maintain high meetings counts in June.

Much Ado in the U.K.

The U.K. voting season traditionally lingers well into July, as companies with different reporting year-ends spread out the season. This will be the case again in 2015, as ISS is already tracking 192 meetings in the U.K. for June, with a number of companies having not filed yet, against a total of 283 in June of 2014.

While the U.K. voting season has not had any major fireworks this year, a change from last year when the implementation of binding pay policy proposals was a major focus of market participants, there have been a few noteworthy issues, including the impact of various regulatory fines and settlements in 2014 and 2015. The most recent banking misconduct issues to surface have been with recent news that two U.K. banks, Barclays and the Royal Bank of Scotland (RBS) (along with two major U.S. banking corporations), will plead guilty to US felony charges connected with manipulation of U.S. dollar and Euro exchange rates, with total resulting fines of more than $5.8 billion between all banks involved.

French Market Updates

The shareholders of many major French companies have voted to opt out of the Florange Act’s provisions on double voting rights and the use of issuance authorizations as anti-takeover measures. Two notable exceptions are Air France KLM and Renault, where proposals to opt out of double voting rights provisions have been rejected, a phenomenon that is partially attributable to the French State’s increase in its shareholding through either share borrowing or the outright acquisition of shares.

Between 2014 and 2015, as shown in the table, several major French issuers have seen dramatic shifts in shareholder support for their compensation votes.

At some of the companies with significant losses, the reasons behind shareholder discontent were clear. For example atSanofi, the company spent over EUR 8 million cash in remuneration to top executives as a result of a CEO change; a move that received public criticism in France, in particular by two French ministers, Ségolène Royal (Minister for Ecology) and Stéphane Le Foll (Minister of Agriculture).

At GDF Suez, there was some degree of turmoil with the top executive succession planning, as Gérard Mestrallet, who was set to leave GDF Suez in 2016, did not designate Jean-François Cirelli as his successor, although Cirelli had been promised the role of chairman/CEO at the onset of the merger between GDF and Suez. Instead, Isabelle Kocher, who was appointed vice-CEO to replace Cirelli, is to become the future chairman/CEO when Gérard Mestrallet leaves the company. Despite this, the company’s pay practices passed shareholder muster, and the approval rate went up significantly.

Russian Regulatory Updates

The 2015 Russian proxy season is the first following the Sep. 1, 2014, entry into force of the new Russian Civil Code, which has had three main effects. First, it made significant changes to the recognized types of legal entities. Second, it allowed shareholders of public companies to enter into corporate agreements and substantiated the general concept of such agreements. Third, it stipulated a number of mandatory requirements for public joint stock companies, aimed at enhancing the protection of minority shareholders. In particular, voting and ownership ceilings have been declared illegal, and issuers are required to disclose all the information required by law to the general public, whereas previously the only requirement was that information be made available to shareholders.

This legislative update has now been bolstered by the introduction of a new Corporate Governance Code in April 2014 and the adoption of new listing rules by the Moscow Exchange in June 2014. As a result, most large- and mid-cap companies this year have provided comprehensive disclosure on director nominees, including compliance with the director independence criteria stipulated in the aforementioned documents. While it is still too soon to assess the quantitative effects of these changes, among companies covered by ISS Quickscore, only 15 percent of companies complied with the code’s recommendation of one-third independence before the 2015 Russian proxy season, while an additional 8 percent complied with the listing rules’ requirement of 20-percent independence. — Martin Wennerström, ISS’ Head of EMEA Strategic Research Analysis and Studies