2024 Silicon Valley 150 Corporate Governance Report

Below are the key findings from Wilson Sonsini Goodrich & Rosati’s 2024 Silicon Valley 150 Corporate Governance Report, which analyzes the corporate governance practices and disclosures of the Valley’s largest public companies based on reviews of proxy statements filed between October 1, 2023, and September 30, 2024 (referred to as 2024 in this report), as well as corresponding annual meetings and related documents

• Virtual meetings are here to stay. Following the practice started during the COVID-19 pandemic, approximately 89% of the SV150 opted to hold a virtual meeting in 2024 rather than a physical one.
• ESG/CSR disclosure in the proxy statement and on websites continued to remain strong throughout the SV150, with 83% of the top 100 companies having such disclosure in their proxies and 92% of the top 100 companies having such disclosure on their website.
• Over three-quarters of the SV150 companies published an ESG Report on their website, with 98% of the top 50 companies doing so. Most of the companies that issued an ESG Report (80.3%) issued a single report rather than multiple reports. Nearly 50% of the ESG Reports contained an independent, third-party assurance of some of the data.
• Most companies discussed ESG or sustainability and cybersecurity committee responsibility in their proxy statements (83.9% and 90.6%, respectively). In most companies, ESG or sustainability was handled by the nominating/corporate governance committee (78.5%) and cybersecurity by the audit committee (78.8%). The number of standalone cybersecurity/privacy committees remained steady at 13.
• Human capital disclosure remained strong this year, with 74.7% of companies including such disclosure in their proxy statement. Most of the companies (73.8%) chose a qualitative discussion although 41.6% provided specific numbers. Of those companies that provided quantitative human capital information, 37 companies disclosed diversity numbers or percentages among employees or some subset of employees. A significant number of companies (69.8%) gave their compensation committee a mandate in the charter or proxy statement to oversee human capital matters.
• Voluntary proxy statement disclosures in general and proxy summaries also continued to remain prevalent throughout the SV150, depending on the type of disclosure, although it continued to be the case that these are much more likely to be implemented by top 50 companies—and shareholder proposals are almost always directed to top 50 companies.
• Almost all Nasdaq companies (approximately 95.3%) included the board diversity matrix in their proxy statements rather than on their websites. Adoption of the Nasdaq board diversity matrix was not common among NYSE companies, although 11 included it or included diversity information in comparable detail. Among the NYSE companies that did not include such extensive information, all but 8 companies identified whether the company had “diverse” directors by the company’s own definition of diverse, which generally included racial or ethnic diversity or LGBTQ+. The extent of average diversity on the boards of Nasdaq and NYSE companies was similar, with approximately 30% for Nasdaq companies and almost 28% for NYSE companies. Non-binary directors were rare, with only one Nasdaq company and one NYSE company identified as including a non-binary director.
• The SV150 is still fairly diversified in years since IPO, with two of this year’s SV150 newly public. The top 50 companies continued to have substantially greater annual sales, market cap, and profitability than the other 100 companies.
• The top 50 companies, on average, have up to two more directors. In addition, directors at the top 50 companies have longer tenure, are older, and are more likely to be subject to mandatory retirement policies. Female directors, however, are more common throughout the SV150, with the bottom 50 companies actually averaging a higher percentage of female directors (34.9%) than the top 50 companies (33.5%).
• Companies more than 20 years from their IPO are significantly more likely to have an independent chair than any other demographic factor.
• The number of women executive officers (21.0%) is considerably higher than women CEOs (5.3%).
• The top 50 companies are much more likely to have a non-classified board, majority voting, proxy access, and ability for stockholders to call a special meeting or act by written consent. Years since IPO also plays a role in these decisions.
• Activism affected 7.4% of SV150 companies in 2024. Only one activism campaign resulted in a proxy fight, with the most frequent result being at least one director added to the board in a settlement with the activist stockholder.
• Almost 94% of SV150 companies that have chosen say-on-pay frequency have adopted annual say-on-pay votes, and of the companies that took a say-on-pay vote in 2024, nearly 56% received greater than 90% stockholder approval.
• Executive compensation perks are primarily found in top 50 companies, regardless of time since IPO.
• Most companies (94.7%) included pay versus performance disclosure in their proxy statements. Revenue was the most frequent company selected measure (57.7%) with earnings the next most frequent company selected measure (27.6%). Among other performance measures included in the SV150 companies’ tabular lists, earnings was the most frequent (39.6%). Most companies included two or three measures in their tabular lists of performance measures (59 companies and 28 companies, respectively), in addition to their company-selected measure.
• Nearly every SV 150 company, as required, filed a new clawback policy in response to SEC requirements. As expected, the vast majority of companies did not expand their policies beyond Nasdaq and NYSE requirements, although several did.

Looking forward to 2025, we expect that companies will continue to actively engage with their stockholders on performance metrics, governance, executive compensation and say-on-pay, as well as other matters. We anticipate that companies will continue to focus on adequately communicating board actions in these areas through their proxy statements. Despite the stay on the SEC’s rules on climate disclosure, companies will undoubtedly continue to focus on ESG and greenhouse gas emissions disclosure. And stockholder activism will continue to be a focal point for many companies.

Link to the full report can be found here.