Future Leaders Blog

The ICGN Future Leaders Committee aims to integrate the perspectives of early career professionals into ICGN’s policy work. Following its appointment in January 2025, the Committee decided to focus on three key themes: Capital markets competitiveness, Executive remuneration and Board effectiveness. Its members have produced videos and articles to share their insights and stimulate debate on important corporate governance issues. The views expressed are those of the individual members of the Future Leaders Committee and do not necessarily reflect the positions of the ICGN Secretariat or its members. 

How can investors further incorporate board effectiveness considerations into their proxy voting and engagement policies?

Katie Thomas, Analyst, Sustainable Investing, AIMCo

An effective board can guide strategic direction and support long-term value creation, while maintaining accountability to stakeholders. Board effectiveness is characterized by diverse expertise, strong governance practices, and a culture of accountability and engagement. Key factors that contribute to board effectiveness include thoughtful board composition, clear and consistent disclosure practices, and meaningful engagement with both management and shareholders.[1] Investors can help support board effectiveness considerations by incorporating requirements that support and measure board effectiveness into their proxy voting and engagement guidelines.  

Proxy voting guidelines can include board effectiveness requirements on board composition — which can include requirements for diversity, skills and experience — and requests for clear, transparent disclosure on such requirements, including potential voting action against directors for insufficient disclosures. 

Shareholders can also engage directly with board members or senior leaders to help support board effectiveness and promote transparency and accountability. By integrating board effectiveness considerations into their engagement guidelines, shareholders can better understand the dynamics of the board and the mechanisms in place to ensure effective governance. Board engagement also allows shareholders to understand how boards are overseeing emerging governance risks, which may include topics such as cybersecurity and the responsible use of AI.  

Proxy voting and engagement policies are important mechanisms for shareholders to support board effectiveness, and shareholders could consider ways to further integrate these considerations into their policies and guidelines. 

[1] Paula Graullera Castillejos, ‘How Diverse Leadership Teams Boost Innovation’, S&P Global, 2024 April 1, https://cdn.ihsmarkit.com/www/pdf/0424/Stakeholder-Governance_SP-Global_April-2024.pdf [accessed 8 August 2025].

Will Farrell

Federated Hermes
Assistant Manager, EOS
London

Will co-leads the climate change theme at EOS, the stewardship arm of Federated Hermes Limited, where his coverage includes companies in Europe and Australia, primarily financial services, energy, chemicals, and materials. Prior to joining EOS, Will worked in the energy and infrastructure investment banking team at Macquarie Capital, where he specialised in renewable energy. Before that, Will held a number of roles across the UK climate policy space, including as a parliamentary researcher for Rt. Hon. Chris Skidmore MP on climate and energy issues, and as a climate and economic policy analyst at a diplomatic institute. He was appointed as a voluntary adviser to Rt. Hon. Alok Sharma MP, President of COP26, on preparations for COP26 after co-founding a Westminster climate policy group in 2019, which engaged MPs and Members of the House of Lords to advocate for more ambition on climate action in public policy. Will has a Bachelor’s degree (1st Class Honours) in Economics from the London School of Economics and Political Science.