The Council of Institutional Investors (CII), which represents pension funds and other institutional investors in the US, has published two reports highlighting the most effective ways to conduct and disclose engagement between investors and companies.

CII Investor-Company Roundtable: Effective Engagement is the result of a roundtable convened by CII in July 2015 to discuss the most effective engagement practices for companies and investors. The other publication, Best Disclosure: Company-Shareholder Engagement, highlights 10 companies’ 2014 or 2015 proxy disclosures of their engagement practices. The companies were identified as having exemplary disclosure in a survey of CII members.

Among the US companies that provided best practice in their engagement disclosure were Chevron, Coca-Cola, Ford Motors, PepsiCo, and Prudential Financial. The CII found that half of the companies provide detailed information about the processes they employ to facilitate engagement; three included instructions and/or email addresses for shareholders wishing to engage with the companies and several companies quantify their engagement activities. For example, Chevron reported that its engagement team held more than 40 discussions with shareholders representing over 30% of the company’s common outstanding stock.

Other companies listed reforms they made to their governance practices as a result of feedback from discussions with shareholders.  Prudential Financial said it had adopted proxy access, extended its compensation clawback policy, increased its CEO stock ownership guidelines and reformed other provisions in its executive compensation program as a result of shareholder engagement.

The roundtable discussion highlighted that investor engagement in the US has become more extensive with investors talking to representatives of both large and small companies. Companies and shareholders viewed engagement as a year-round exercise. They agreed that periodic engagement outside of the busy AGM season produces stronger long-term relationships and better outcomes. All the participants also agreed that engagement topics should not be limited just to matters that are up for a vote on the proxy card at annual general meetings.