Model guidelines for proxy voting.

What's on Big Labor's mind as to what constitutes good governance standards? Last year the Association of Federated Labor-Congress of Industrial Organizations (AFL-CIO) issued Proxy Voting Guidelines, a new 23-page publication designed to assist union and public employee fund trustees in identifying the kinds Of corporate accountability practices that should be supported or opposed. Here are several of its new directives as highlighted in an AFL-CIO overview.

Executive Compensation

* The new guidelines elevate executive compensation as an issue, and provide more rigorous criteria for evaluating and opposing compensation plans.

* Oppose the replacement or repricing of stock options, stock compensation plans that excessively dilute the company stock, and overly complex and complicated plans that provide directors with too much discretion.

* Oppose compensation plans that adversely impact employee productivity and morale.

* Support stock compensation plans that contain premium priced stock options, or stock options tied to exceeding market indexes.

* Support full disclosure of executive compensation, and linking executive compensation to the achievement of performance goals that impact the long-term performance of the company (e.g. compliance with environmental laws, workplace health and safety, or labor supplier standards).

* The new guidelines take a stronger position against golden parachutes, recommending that voting fiduciaries "generally oppose management proposals" for parachutes.

Board of Director Issues

* Support proposals establishing a majority of independent directors on boards.

* Support eliminating director perks like pension and benefit programs which can reduce the independence of directors from management.

* Require all or a majority of independent directors on nominating, compensation, and audit committees.

* Language has been added supporting...