Disclosures made simple.
that’s difficult to understand more accessible for others is a very
difficult job – and making a proxy statement easy to read ranks among the
toughest examples of this. The additional regulatory disclosures that have
become required in the last few years have complicated matters further,
placing added pressure on companies to address the challenge of including
even more information without turning an already complex document into a
totally perplexing one.
Prudential Financial has long been considered among the leaders in preparing
proxy statements, but this year the company took its expertise to another
level. Starting with a commitment to using plain language throughout the
document to ensure clarity, Prudential used a number of design features to
organize the information into a surprisingly inviting read. Excellent use of
charts, graphics and soft colors made the document less intimidating, and
bold labeling of key information made it easier to navigate than most proxy
statements. An up-front snapshot summary, detailed profiles of director
qualifications and an extensive listing of governance policies – including
sustainability factors – were also among the innovations that led to
Prudential winning Corporate Secretary’s award for best proxy
statement this year.
Prudential Financial chief governance officer, vice president and corporate
secretary Peggy Foran says the proxy statement is part of the company’s
overall commitment to shareholder communications. Prudential’s aim is to
produce a document that meets regulatory requirements while communicating
with investors in a way that facilitates their voting decisions. ‘We all
worked together to find the best way to get the message out and to create a
document that tells our story and can be easily read,’ Foran says.
In fact, the company’s commitment to shareholder communication extends
beyond its own shareholders. Prudential willingly shares its proxy expertise
and innovations with other issuers prior to proxy season – a policy that
helps improve governance standards throughout the industry.
Prudential has also proven to be an early adopter of best practices
regarding company disclosures. For example, part of the company’s
compensation discussion and analysis spells out the board’s compensation
philosophy and how elements of Prudential’s compensation policy are designed
to align executive compensation with long-term shareholder interests –
something proxy advisory firms ISS and Glass Lewis will emphasize in the
coming 2012 proxy season.
goes so far as to include painstaking detail concerning each named executive
officer’s compensation, including bullets explaining factors that the
compensation committee has considered in determining the effectiveness and
impact of the executive’s contribution to the company.
Cross Border Ltd. 1995–2012.