The CEO of the ICGN discusses representing the interests of institutional investors in the governance landscape and how stakeholders can work together to deliver better outcomes
Jen Sisson was appointed CEO of the International Corporate Governance Network (ICGN) in 2024, joining from Goldman Sachs Asset Management where she was EMEA Head of Stewardship. Before this she had spent over four years at the Financial Reporting Council latterly as the Deputy Director of Stakeholder Engagement and Corporate Affairs, having started her career with PwC.
In May, she joined Gareth Sykes, UK Head of Corporate Governance Advisory at Herbert Smith Freehills Kramer to discuss reporting, reform and remuneration, hitting many of the hot topics currently being debated in the UK corporate governance ecosphere.
For those not familiar with the ICGN, it is a membership body, led by investors from all over the world who between them manage about $90 trillion of assets. The members are mostly asset owners, such as pension schemes, sovereign wealth funds and asset managers but there are also various service providers and even some corporates who are members. The purpose of the ICGN is to promote high standards of governance and stewardship and it focuses on four key areas: effective boards, protecting shareholder rights, reliable reporting and best practices in investor stewardship.
This discussion took place prior to publication of the updated Stewardship Code on 3 June 2025.
Listen to the interview
Speaking in May, we are at peak governance season in the UK. What are some of the key themes, trends and issues that have arisen this AGM season from the perspective of the ICGN's members?
There have been a lot of high profile individual votes at meetings so far this year in the UK. There's been a lot of focus on remuneration and we're seeing higher votes against on some pay implementation resolutions, typically where the structures proposed are not meeting investor expectations or where the combination of the structural and quantum changes is pushing boundaries. A helpful approach when developing remuneration structures is to think about what you are proposing from an investor perspective – do pay structures and packages allow the company to attract and retain the right people but at the same time align with long-term shareholder value creation? Where both of these things are true, investors will generally be supportive. Overall, the question becomes whether pay aligns with performance and so typically, there is an expectation for long term measures and stretching the right use of discretion by the remuneration committee in particular to override formulaic outcomes. There's no right answer, but where the quantum does not align with performance, that is where you tend to see more push back on pay structures.
There has also been increased escalation in investors' stewardship activities with regard to voting on director appointments to express concerns about strategic or other changes, and also some significant votes in favour of shareholder proposals, triggering an expectation at the ICGN for companies to engage with their shareholders and update the market following votes on such proposals.
We have seen the issue of virtual-only AGMs being raised by retail shareholders, who are actively asking for companies to keep a physical element to the AGM. And as you know the government has said that it intends to publish proposals to clarify the law in relation to virtual only AGMs. Do you think that institutional investors will support virtual-only AGMs or are their views more aligned with those of the retail shareholders we have been hearing from at AGMs this year?
I am very confident that the ICGN will not be supportive of a move to allow virtual-only AGMs. Whilst you can't speak for everyone, that is a pretty widely held view. The AGM is a key mechanism for corporate accountability, and I think that we shouldn't diminish the importance of the AGM. Fully virtual AGMs significantly limit the ability of shareholders, especially minority shareholders, and it is hard to interact with boards without a good AGM. There's a trust element from actually having people in the room. We want to be able to ask unmoderated questions and if needed, make statements from the floor of the meeting.
I think the view of both retail and institutional shareholders is clearly very aligned – fully virtual AGMs are not a good idea."
On virtual-only AGMs
We are however supportive of hybrid AGMs as they do allow for broader participation, especially where investors are spread across the world. A recent report from the OCED on shareholder meetings shows that globally the trend is to hybrid in this regard.
For anyone considering a virtual-only meeting in the future, investors are really going to want to understand the rationale and many institutional investor voting policies oppose resolutions proposed to permit virtual-only meetings unless there are extenuating circumstances.
The ICGN is engaged with lots of policy work and a large portion of that has been responding to various consultations in the UK, including the reform of the UK Listing Rules by the FCA in 2024. How are the new UKLRs bedding down from your perspective and do you have a sense of how investors have adjusted to the new regime? Have they changed their approach to engagement with listed companies on significant transactions, where previously they would have received a circular and been asked to vote on the transaction?
The ICGN was not supportive of those changes to the Listing Rules and I think that institutional investors more broadly were not supportive. Of course investors are supportive of growing the capital markets and having more listed companies and creating better long-term returns for investors and savers. However, doing that at the expense of shareholder protections adds new risks into the system which makes people uncomfortable.
We are seeing different choices by governments and policy makers, about how to position their markets, play out really differently around the world. In the UK, the EU and the US we are seeing a bit of a deregulatory swing, trying to lower some standards; whereas in countries like Japan, South Korea, India and Singapore, they are going completely the other way, trying to strengthen shareholder rights and fiduciary duties. And the markets in these countries are seeing good inflows and investing. High standards are good for trust, and they are good for investor confidence.
Where there is more risk in the system, the role of active stewardship and active ownership is probably growing whereas previously there might have been more reliance on governance frameworks and norms.
I do think that, as I said with AGMs this year, what we will see over time is in the absence of votes on significant transactions and related party transactions, your alternative is to vote against the directors. So that's what will happen. We haven't seen a great deal of new listings but we also haven't seen a huge amount of transactions that would have been subject to those votes [under the previous listing rule regime]. So we are slightly guessing at the moment what the outcomes will be.
Governments and policy makers have a choice as to how they position their markets and governance standards and shareholder rights [are] a very fundamental part of that."
On UK listing reforms
It is, however, kind of bewildering that these pretty traditional and historically uncontroversial ownership rights are getting cited as disincentives to listing. In reality the UK has a relatively very low regulation approach to corporate governance – we don't have the same kind of litigation environment, and costs that go with that, as you see in the US. We should be talking this up more – the UK framework works pretty well and I think that it's a real incentive actually to be in this governance environment. I don't think we should give it away and end up in a more litigious, aggressive regulatory environment.
There are a handful of other legal and regulatory reforms on the horizon. Which of these is the ICGN particularly focused on and are there any other areas of the legal and regulatory framework that applies in the UK listed company ecosphere that you would encourage the government or regulators to take a look at?
There are two. The first, which I think is important having worked for many years in audit and then at the FRC, is the audit reform bill. The devil is in the detail but there is broad investor support for a statutory regulator. I think also seeing that regulator have powers for financial reporting enforcement over people who aren't members of one of the accounting bodies would be a good thing. You could argue that it is more regulation but I think it's just sensible, proportionate – I don't think people would think that this would be overreach.
The second area where I hope we will see progress soon is on getting the International Sustainability Standard Board's (ISSB) reporting standards endorsed and then adopted in the UK. These standards are investor-led standards and investors are crying out for more consistency. The standards are focused on financial materiality and investors really don't want loads of immaterial reporting and the risk of not having a consistent framework is that you end up back in alphabet soup land. One thing that has been a huge step forward in the ISSB process is that there is a huge consensus right around the investor community, which has banded together and said let's get this done, let's not have too much, let's not have gold plating -let's just set a consistent global baseline.
My hope is that the UK is a leader in this. Let's be an early adopter, let's not be the last one to the party and many companies in the UK are already doing this on a voluntary basis anyway because it is the right thing to do.
If you had one message or one piece of advice for governance professionals, in particular those in the listed company community, what would it be?
The thing that strikes me the most is that we need to have a bit of a change, a mood shift. We need to work together to build a bit of understanding between companies, governance professionals in companies and investors, and investors – we all have completely aligned goals. Investors are not trying to stymie companies with their engagement and voting. Companies want to be successful, and investors who own these companies want them to be successful too. There's no misalignment.
It felt a bit combative over the previous few years...I would imagine that chimes with the listeners. Often it's felt a bit like everything has to be an argument. I don't think that's helpful...We've got to find ways to make these more constructive discussions, communicate better and build that shared understanding."
I think we could probably do with a bit more listening, trying to understand common, shared goals. That would be a nice way to move into the next phase where I believe governance is going to be more important than ever. And we've really got to get it right.
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