Glass Lewis Publishes 2026 Benchmark Proxy Voting Policy Guidelines

Key updates for the 2026 proxy season introduce new guidance on mandatory arbitration provisions, pay-for-performance methodology enhancements, and policy refinements on shareholder rights, supermajority vote requirements, charter/bylaw amendments and shareholder proposal exclusions

Proxy advisory firm Glass Lewis (GL) has published its 2026 U.S. Benchmark Policy Guidelines and related 2026 Benchmark Policy Guidelines for Shareholder Proposals & ESG-Related Issues, which are effective for shareholder meetings held on or after January 1, 2026. The principal policy changes and clarifications are summarized below.

These updates arrive amid intensified regulatory scrutiny and mounting legal and political pressures confronting proxy advisory firms. Recent developments include the December 2025 executive order directing federal agencies to increase oversight of proxy advisors and curb their influence on shareholder voting—particularly on social and political issues (see our earlier discussion); SEC Chair Paul Atkins’s stated intent to review and potentially revise regulations relating to proxy advisors and shareholder proposals, with proposed rulemaking anticipated in the first half of 2026; an ongoing FTC antitrust investigation into GL and fellow proxy advisory firm ISS; and active state-level investigations, enforcement actions and litigation in Florida, Missouri and Texas challenging the firms under consumer protection and antitrust laws.

As part of a broader shift in its business model, GL announced plans last October to retire its uniform benchmark policy guidelines in 2027 in favor of customized proxy voting frameworks aligned with clients’ individual investment philosophies and stewardship priorities. Most clients already use custom or thematic voting policies, and GL aims to offer all clients tailored, AI-enabled advice by 2028.

GL will also shift from singularly focused, benchmark-based research and voting recommendations to providing multiple perspectives (Active Ownership, Management-Aligned, Governance Fundamentals and Sustainability)—allowing clients to select the research lens that best aligns with their firm-specific voting policies and strategic objectives. Beginning in 2027, clients will be able to access any or all of these perspectives to inform their proxy voting decisions.

In a related development, JPMorgan Asset Management has reportedly cut all ties with proxy advisory firms and, starting this proxy season, will instead use a newly launched internal AI-powered platform, Proxy IQ, to vote U.S. company shares—a move the bank described as an industry first. The platform will analyze data for more than 3,000 annual shareholder meetings, provide voting recommendations to portfolio managers and manage votes, replacing the typical roles of ISS and GL.

Key Changes

Mandatory Arbitration Provisions

GL has adopted a new policy opposing issuer-investor mandatory arbitration provisions (MAPs), following the SEC’s September 2025 policy statement reversing its longstanding opposition to the presence of MAPs in company governing documents (see our client alert). MAPs require investors to resolve federal securities law claims exclusively through arbitration with the issuer rather than through litigation.

GL notes that many investors view MAPs as detrimental to their interests because arbitration may restrict shareholder rights—including the right to initiate legal action in court, participate in court proceedings and pursue class-action lawsuits (often the only practical mechanism for federal securities law claims). Additionally, arbitration keeps proceedings and decisions confidential, limiting the transparency and legal certainty of public litigation.

Although GL typically refrains from making recommendations based on governance standards during the one-year period following a company’s IPO, spinoff or direct listing, it believes certain cases—where investor rights are curtailed—may warrant shareholder action against the board. For 2026, GL has expanded its review of potentially problematic governance provisions in newly listed companies to include MAPs alongside other restrictions such as classified boards, supermajority vote requirements and exclusive forum provisions. Under the new policy, if a newly listed company’s board has approved “highly restrictive” governing documents containing MAPs, among other restrictive provisions, GL may recommend voting against governance committee members.

GL will also generally recommend voting against any bylaw or charter amendment seeking to adopt a MAP, unless the company:

• • provides a compelling argument on why the provision would directly benefit shareholders;
  • provides evidence of abuse of legal processes; 

• • narrowly tailors such provision to the risks involved; and 

• • maintains a strong record of good corporate governance practices.

Enhanced Pay-for-Performance Methodology

GL has updated and expanded its proprietary quantitative pay-for-performance model, replacing its single letter grade system (A through F) with a numerical scorecard-based approach consisting of up to six tests. Each test receives an individual rating, which are then aggregated on a weighted basis to produce an overall score ranging from 0 to 100. Notable changes also include an elongated measurement period of five years versus the previous three-year period (if five years of data are unavailable, three years may be used for most tests), an expanded view of compensation beyond granted pay and consideration of qualitative features. While there has been no change to GL’s peer group methodology, two other comparator groups—market cap bands and broad market benchmarks—have been incorporated for two of the new tests.

The overall scores and ratings range as follows:

• • Severe Concern: 0 to 20 points
  • High Concern: 21 to 40 points
  • Medium Concern: 41 to 60 points
  • Low Concern: 61 to 80 points
  • Negligible Concern: 81 to 100 points

The six individual tests are:

Companies that demonstrate weaker pay-performance alignment (an overall rating of “Severe Concern” or “High Concern”) are more likely to receive a negative say-on-pay recommendation under the benchmark policy; however, GL considers other qualitative factors in developing its recommendations, as each company is reviewed on a case-by-case basis. These additional factors include, but are not limited to: (i) the overall incentive structure; (ii) the trajectory of the program and any disclosed future changes; (iii) the operational, economic and business context for the year under review; (iv) the relevance of selected performance metrics; and (v) the reasonableness of long-term payout levels. These factors may provide sufficient rationale for GL to recommend in favor of a proposal even if there is an identified disconnect between pay and performance.

GL frames the new scorecard approach as addressing stakeholder concerns about transparency, consistency, comprehensiveness and long-term investment alignment. The firm emphasizes that the changes were made “based on extensive evaluation of market trends and ongoing dialogue with both shareholders and covered companies.” According to GL, “[b]y expanding the scope of analysis, lengthening the measurement horizon, and introducing a transparent scorecard structure,” the updated methodology “aims to provide investors and covered companies alike with a clearer, more comprehensive view of pay-for-performance alignment.”

To better understand the revised model, see GL’s 2026 Pay for Performance webpage, New Methodology Overview, FAQs, Test Breakdown and sample proxy research report.

ISS has similarly extended its pay-for-performance analysis from a three-year to a five-year window, as noted in our summary of its 2026 benchmark policy updates.

Key Clarifications

Shareholder Rights

GL has expanded its list of board actions that may trigger adverse vote recommendations against the governance committee chair or the full committee when the board unilaterally amends the company’s governing documents to reduce or remove important shareholder rights (or otherwise impede shareholders’ ability to exercise such rights) without shareholder approval. Beyond traditional governance impediments—such as classified boards, supermajority vote requirements, and removal of special meeting or written consent rights—the expanded list now includes unilateral board actions that:

• • Implement a plurality voting standard for director elections in lieu of majority voting.
  • Limit shareholders’ ability to file derivative lawsuits.
  • Limit shareholders’ ability to submit shareholder proposals.

GL’s expansion appears responsive to recent legal and regulatory developments. Reforms to the Texas Business Organizations Code enacted in 2025 allow companies to adopt opt-in provisions through bylaw or charter amendments that restrict both derivative litigation and shareholder proposals through ownership thresholds.

Concurrently, SEC Chair Atkins asserted (as we previously discussed here) that Rule 14a-8 does not preempt shareholder proposal submission requirements imposed by state law or company governing documents, potentially permitting companies to adopt bylaws that establish heightened eligibility or procedural restrictions for shareholder proposals, in excess of Rule 14a-8. However, this view remains legally unsettled and could face preemption challenges in litigation.

Supermajority Vote Requirements

GL has revised its policy to clarify that it will evaluate proposals to abolish supermajority voting requirements on a case-by-case basis. The updated policy notes that, while GL generally supports eliminating supermajority thresholds, in certain instances—such as at companies with large or controlling shareholders—these provisions may serve to protect the interests of minority shareholders, in which case GL may oppose their elimination. In analyzing these proposals, GL will take into account additional factors including shareholder structure, quorum requirements, impending transactions (involving the company or a major shareholder) and any internal conflicts within the company.

Charter and/or Bylaw Amendments

GL has consolidated its approach to charter and bylaw amendments into a single section, which now states that GL will evaluate proposed amendments on a case-by-case basis. GL will generally recommend voting for amendments unlikely to have a material negative impact on shareholder interests—such as technical amendments or revisions reflecting changes to corporate law.

GL strongly opposes the practice of bundling several amendments under a single proposal because it prevents shareholders from reviewing each amendment on its own merit. When amendments are bundled, GL will analyze each proposed change on an individual basis, and recommend voting for the proposal only when, on balance, the amendments are in the best interests of shareholders. Material concerns with any single amendment may lead to a recommendation to vote against the entire bundled proposal.

Director Election Voting Standards

GL has updated its guidance on director election voting standards to clarify language and correct outdated references. Substantively, there are no changes to GL’s policy: the firm continues to prefer a majority vote standard over plurality voting for uncontested director elections, reflecting its commitment to director accountability and shareholder rights.

Shareholder Proposal Exclusions

GL has updated its approach to shareholder proposal exclusions following the SEC’s November 2025 decision to pause substantive reviews of most Rule 14a-8 exclusions this proxy season, limiting its review of no-action requests to state law-based exclusions under Rule 14a-8(i)(1). Companies must still provide notice of their intent to exclude a proposal and cite a basis for exclusion. Under the new approach, if a company provides an unqualified representation that it has a reasonable basis for exclusion, the SEC staff will issue a generic “no objection” letter but will not evaluate the merits of the company’s stated rationale.

Under its previous policy, GL recommended voting against governance committee members if a company omitted a shareholder proposal from its proxy ballot without obtaining SEC no-action relief. Given the SEC’s reduced role in adjudicating exclusion requests, GL has deleted this voting recommendation but reaffirms that “shareholders should be afforded the opportunity to vote on matters of material importance.” While acknowledging that some shareholder proposals can unduly burden companies, blur the line between shareholder and board authority, or not serve long-term shareholder interests, GL nonetheless views the right to submit proposals as critical to effective corporate governance and the long-term economic interest of all shareholders. GL further notes that important corporate governance reforms—such as declassified boards and majority voting—would not have been achieved without shareholder proposal rights and that even withdrawn proposals, such as those on executive compensation, can encourage beneficial corporate practices benefiting all shareholders.

GL intends to closely monitor how the SEC’s ongoing and anticipated changes to the shareholder proposal process affect investor behavior and market dynamics, and reserves the right to further adjust its guidance on shareholder proposal exclusions prior to or during the 2026 proxy season should its approach to these matters evolve or regulatory developments warrant additional updates.

GL will continue to provide information on companies’ no-action/no-objection requests in its Proxy Paper research reports.

Board Diversity

In March 2025, GL modified its approach to providing proxy voting guidance related to diversity factors at U.S. companies under its benchmark policy pursuant to its Supplemental Statement on Diversity Considerations at U.S. Companies. For 2026, GL will continue this modified approach and will provide clients with two recommendations for all director election proposals at U.S. companies where its recommendation is based, at least in part, on gender or underrepresented community diversity considerations—one that applies its benchmark diversity policy and one that does not.

The benchmark policy itself remains unchanged. GL generally recommends voting against the nominating committee chair of boards that are not at least 30% gender diverse, or against all nominating committee members of boards with no gender diverse directors, at companies within the Russell 3000 index. For companies outside the Russell 3000, GL requires at least one gender diverse director. In addition, GL generally recommends voting against the nominating committee chair of boards without at least one director from an underrepresented community at companies within the Russell 1000 index.