EY's review of the S&P 1500 board leadership structures and practices revealed these and other noteworthy practices & trends:
Structure
- 92% of S&P 1500 companies have independent board leadership, up from 10% in 2000.
- 60% of the S&P 1500 (more commonly, the smaller companies) separate the CEO & Chair roles, compared to 27% in 2000.
- Of the 49% of the S&P 1500 with lead directors, 11% are women. Of the 40% of the S&P 1500 with independent chairs, 6% are women. Lead directors are most common among the larger companies; independent chairs are most common among the smaller companies. "Presiding director" roles continue to decline in use.
Disclosure
- 15% of the S&P 500 included a letter to shareholders either from the independent board leader alone (9%) or jointly from the independent board leader & CEO (6%) in their 2018 proxy statement - up from 5% in 2015.
Shareholder Engagement
- 14% of the S&P 500 disclosed in their 2018 proxy statement that the independent board leader was directly involved in engagement discussions with shareholders over the past year - up from 4% in 2015.
Based on EY's review of Fortune 100 proxy statements, corporate governance guidelines, and bylaws, independent chairs, lead directors, and presiding directors are commonly charged with different key responsibilities, as shown here:
* Based on the most recent proxy statements, corporate governance guidelines and bylaws of 86 public Fortune 100 companies that file proxy statements. Yellow triangles indicate that a majority of companies with such position specifically assigned the responsibility; gray triangles indicate that at least a quarter of companies with such position assigned the responsibility.
** Reflects primary responsibility for chairing board and shareholder meetings. Most lead and presiding directors have responsibility for presiding over board meetings in the chair's absence, and some lead directors have responsibility for presiding over shareholder meetings in the chair's absence.
The report includes a series of questions for the board to consider that will help facilitate internal dialogue and shareholder engagement around the board's leadership structure and the board leader's qualifications to serve in that role.