Wendy Cassity, executive vice president and chief legal officer at Nuance Communications, joined the company in late 2018 with a mandate to bring about a major overhaul of the company’s governance.
And Cassity and her new, hand-picked team have delivered just that. As the company says in its submission: ‘Nuance was ready for change. After years of stagnant growth and unresponsive management, there was nowhere to go but up.’
Just 8 percent of votes cast were in favor of executives’ compensation at Nuance’s 2018 AGM. Within months of the meeting, seven of the board’s nine directors were new and the board was more diverse, with an independent chair and newly adopted majority voting. There was also a new CEO and new executive compensation practices.
Cassity brought on board new hires including new chief privacy officer Jean Liu – who also had significant experience designing and implementing corporate compliance programs – and Justine Bensussen as the new corporate and governance counsel. A key aspect of Cassity and her team’s work has been designing and leading a major off-season and in-season shareholder engagement program. ‘It was about listening to what [governance] areas they wanted us to focus on and then taking action on all of those items,’ she says. Those included board diversity, executive compensation and ESG disclosures.
As a result, Cassity created the company’s first ESG report, using input from general counsel at other companies and a consultant. She also engaged with people at the company who were already working on ESG matters but weren’t aware that was what they were dealing with.
The team overhauled Nuance’s online compliance training for employees. Cassity notes that some of the content had gone unchanged for years, resulting in employee fatigue. She brought in new people to look at the content, leading to the revised training being completely new in its focus and topics more streamlined. The workforce responded by completing training more quickly, and the completion rate rose to 99 percent from 80 percent the previous year.
The team also held an employee contest to rename the whistleblower hotline, which is now known as the Ntegrity Helpline. Cassity explains that the aim of renaming and refreshing the platform was to encourage employees to come forward with questions and concerns, and she has been encouraged by the increasing use of the helpline.
Among other changes Cassity and her team have implemented over the past year or so is the creation of new company values and a complete rewrite of Nuance’s code of conduct and business ethics. They have also created a new ‘trust center’ section of the firm's website highlighting Nuance’s work on privacy, security and compliance.
In addition, they have advised the board on new corporate governance and compensation program changes, including adopting the shareholder right to call a special meeting with a 15 percent threshold, revising the corporate governance guidelines to strengthen the role of independent lead directors and revising director and officer stock ownership guidelines to adopt stricter ownership requirements.
The company’s shareholders and employees are happy with the changes: Nuance received 92 percent support in its say-on-pay vote at the 2020 AGM, and the share price rose 70 percent between June 30, 2019 and July 1, 2020.
The results of the employee engagement survey have improved markedly over the past year. ‘[O]ur employees tell us that culture, compliance and governance matter to them, and that our recent changes to all three make them feel proud to be part of the new Nuance,’ the company states.
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Ben Maiden
Ben Maiden is the editor-at-large of Governance Intelligence, an IR Media publication, having joined the company in December 2016. He is based in New York. Ben was previously managing editor of Compliance Reporter, covering regulatory and compliance...
