It is our concern that ISS' proposed default recommendation for an annual say-on-pay vote does not advance the most effective formulation of the say-on-pay vote, in that it promotes the quantity of say-on-pay votes over the quality of such votes. The ISS overview piece states that the say-on-pay vote "is at its essence a communication vehicle, and communication is most useful when it is received in a consistent manner." We believe that the "most useful" communication vehicle would be an informed vote based on thorough and comprehensive pay plan analysis. An annual vote at thousands of companies would challenge the ability of large institutional investors to undertake a thorough analysis of portfolio companies' pay plans or an appropriate review of the vote recommendations of their advisory firms. The quality and thoroughness of the pay plan analysis supporting say-on-pay votes, not their frequency, will determine the usefulness of the vote in improving executive compensation. [page 2, paragraph 1]

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Our view is that a periodic say-on-pay vote could be a valuable part of a complementary set of advocacy tools that include company-investor dialogue, shareholder proposals, equity and incentive plan votes, and, if warranted, votes AGAINST director nominees. The ISS proposed annual default voting guideline on say-on-pay frequency votes may undermine the development of a thoughtful and effective executive compensation advocacy system. ...While it may be counter-intuitive for a proxy advisor firm to suggest fewer shareholder vote opportunities, in this instance, less is more. Less frequent say-on-pay votes will allow for more comprehensive and thorough plan analysis, more informed voting, more effective advocacy, and ultimately more effective executive compensation reform. [page 3, concluding paragraph]