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For the new policy statement summarized in the press release below, see


TIAA-CREF (as published by BusinessWire), February 25, 2011 press release


Business Wire





Robust Governing Practices and Shareholder Dialogue Aid Public Company Performance, New Edition of TIAA-CREF Policy Statement on Corporate Governance Emphasizes

Statement addresses executive pay, board elections, political contributions, and labor and human rights

Sets forth proxy voting guidelines of America’s largest private retirement system

NEW YORK--(BUSINESS WIRE)--Sound governing practices, responsible corporate behavior, and regular dialogue with shareholders contribute to companies’ long-term performance, TIAA-CREF, one of America’s largest institutional investors, emphasizes in a new edition of its Policy Statement on Corporate Governance released today.

“We’ve updated our guidelines to facilitate a more robust dialog between companies and their shareholders and to encourage more sustainable value creation”
The Policy Statement informs TIAA-CREF’s participants, portfolio companies, and the public about the corporate governance and social responsibility practices TIAA-CREF expects of portfolio companies on matters ranging from executive pay and board elections to political contributions and human rights.

The Policy Statement also discloses how TIAA-CREF generally will vote on proxy resolutions at more than 8,000 portfolio companies around the globe and serves as a basis for dialogue with boards of directors and other senior managers.

“We’ve updated our guidelines to facilitate a more robust dialog between companies and their shareholders and to encourage more sustainable value creation,” said Roger W. Ferguson, Jr., TIAA-CREF’s chief executive. “Regular dialogue between public companies and their shareholders on issues that affect profitability over the long term furthers our goal of maximizing long-term financial performance on behalf of clients.”

“It’s in our clients’ financial interest to promote good governance practices and responsible behavior at companies in which we invest,” said Jonathan Feigelson, TIAA-CREF’s head of corporate governance. “It also reflects our view that by engaging in dialogue and committing to sound practices, companies and their shareholders can promote public trust and confidence in the governance of our public corporations.”

The Policy Statement, which was last revised in 2007, reflects current developments in corporate governance, social and environmental policies, and the convergence of best practices across global markets. It also reflects enhanced shareholder rights and responsibilities recently granted by the U.S. Securities and Exchange Commission (SEC), Congress, and other foreign governments and regulators. Notable provisions address:

Executive Compensation

The Policy Statement includes a revised section on executive compensation, which has come under intensive focus by shareholders, regulators and other stakeholders in recent years. As discussed in the statement, TIAA-CREF does not believe in prescribing specific compensation programs or practices for portfolio companies. As a long-term investor, TIAA-CREF supports compensation policies that promote and reward the creation of sustainable shareholder value.

The new edition emphasizes that TIAA-CREF will use “say-on-pay” votes mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act and implemented last month by the SEC to encourage companies to clearly disclose how executive compensation policies drive long term shareholder value. TIAA-CREF prefers that companies offer an annual non-binding vote on executive compensation. In the absence of an annual vote, companies should clearly articulate the rationale behind offering the vote less frequently.

Shareholder Rights and Responsibilities

As owners of equity securities, shareholders rely primarily on a corporation’s board of directors to protect their interests. Similarly, shareholders should exercise their rights responsibly to ensure that companies are well-managed and positioned to drive long-term value.

The new edition of the Policy Statement highlights that investors should communicate directly with boards when appropriate, without being prescriptive. It incorporates principles of responsible ownership that include holding boards accountable, monitoring performance, and ensuring a long-term orientation.1

Director Compensation, Education, and Elections

The Policy Statement calls for a balanced approach to director compensation that aligns board members’ interests with those of shareholders. It also advocates for more robust director education to increase board members’ knowledge and understanding of the company’s business and operations.

In contested elections of corporate directors, TIAA-CREF will generally vote for candidates who TIAA-CREF believes will best represent the interests of long-term shareholders. In assessing candidates, TIAA-CREF will consider such factors as the board’s independence from management and director qualifications.

The new edition clarifies TIAA-CREF’s view that companies should establish checks and balances to ensure independent board leadership. TIAA-CREF may support shareholder resolutions asking that the roles of Chairman and CEO be separated if there is not a lead director who is genuinely independent of management and the company’s corporate governance practices or business performance are materially deficient.

Global labor and human rights, greenhouse gas emissions, political influence, and divestment

As a matter of good corporate governance, boards should carefully consider the strategic impact of environmental and social responsibility. The Policy Statement discusses these responsibilities and expresses TIAA-CREF’s general support for:

  • Reasonable shareholder resolutions seeking disclosure or reports relating to a company’s political expenditures, and contributions to third parties for the purpose of influencing election results.

  • Reasonable shareholder resolutions seeking a review of a company’s labor and human rights standards and the establishment of global human rights policies, especially regarding company operations in countries plagued by conflict or led by weak governments.

  • Reasonable shareholder resolutions seeing disclosure of greenhouse gas emissions, the impact of climate change on a company’s business activities and products and strategies designed to reduce the company’s long-term impact on the global climate.

The Policy Statement expands on the prior edition’s discussion of human rights. It notes that the international community has established numerous conventions, covenants and declarations which together form a generally accepted framework for universal human rights, and that companies should determine which of these rights may be impacted by their operations and adopt labor and human rights policies that are consistent with the fundamental attributes of these norms.

As discussed in the Policy Statement, it remains TIAA-CREF’s view that long-term shareholder engagement with companies is the most effective and appropriate means of promoting corporate respect for human rights.

Though many of the specific policies relate primarily to public companies incorporated in the U.S., the Policy Statement’s underlying principles apply to all public companies in which TIAA-CREF invests throughout the world. While TIAA-CREF is not a publicly traded company, its own governing practices are guided by the Policy Statement.


TIAA-CREF ( is a national financial services organization with $453 billion in combined assets under management (as of 12/31/10) and provides retirement services to the academic, research, medical, governmental and cultural fields.


1 See also, “New TIAA-CREF Policy Brief Calls on Shareholders to Take an Active Role in Corporate Governance,”

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