The battle over advisory Say on Pay votes at public
companies, which will be in full force this spring, is coming down to
frequency, rather than what's in the plans themselves. In the last week alone,
the topic has been hotly debated in a Governance Center Directors' Institute
Now that the SEC has adopted the final rules for Say on
Pay, Say When on Pay and golden parachutes advisory votes, I thought it would
be a good time to share some examples of a public company that has
already dealt with these votes for the upcoming proxy season.
For those of you who haven't...
On January 25, 2011, the Securities and Exchange
Commission adopted new rules that apply to public companies, as mandated by
Dodd-Frank Act. These rules require that at least once every three years
(starting with this year's annual meetings) shareholders of a public company
vote on the executive...
For those of you who spend a great deal of time preparing
the myriad of filings for regulators and/or board meetings there were two news
events worth noting last week.
The U.S. Chamber of Commerce called for new corporate governance standards that promote investment and
aid economic growth and...
On May 25, 2011, In the latest example of shareholders
suing a company's board following a negative "say on pay" vote, two union
pension funds filed a shareholders'
derivative action claiming that Umpqua Holdings Corporation's board
violated its duties to investor by approving...
The fact that as of June 1, 31 companies out of more than 1,600 have reported
shareholders have voted down executive compensation plans (of those a majority
are small- and mid-cap companies) doesn't begin to tell the story of the first
year of SEC-mandated Say on Pay advisory votes.
While the annual advisory say-on-pay vote has been the
subject of quite a bit of discussion, the new requirement for advisory votes on
merger-related golden parachutes has not be the subject of much attention.
For deal lawyers, though, it is likely going to be an important addition
to the deal process...
by Gary Larkin
The early word on what U.S. public companies should do
following the first mandatory year of Say on Pay is to review the level of
engagement with shareholders vs. the level of support the company received on
the advisory vote.
Depending on what you read or who you talk to, the...
"What is of more concern
to shareholders is that it looks like C.E.O. pay is recovering faster than
company fortunes," said Paul Hodgson, chief communications officer for
GovernanceMetrics International, a ratings and research firm (" We Knew They Got
Raises. But This? " New York...
by Gary Larkin
If you sit on the board of any of the 39 companies that
had a failed Say on Pay vote the past proxy season, I don't need to tell you
that despite the fact the votes were only "advisory" there will be some
shareholder repercussions. In the past year, seven companies...
Only small a
small number of companies experienced a negative "say on pay" vote this
past proxy season, but many of the companies that did found
themselves hit with a shareholder lawsuit in the wake of the negative vote.
Cincinnati Bell is one of the companies that with both a negative...
by Gary Larkin
Even though shareholders approved most of the executive
compensation plans put up for vote in the 2011 proxy season, the tiny minority
of failed say on pay votes are getting an inordinate amount of attention for a
myriad of reasons.
Those reasons, which reflect an overarching...
The advisory shareholder vote required under the Dodd
Frank Act went through its first cycle in 2011, and by and large most
companies' shareholders approved the companies' executive compensation plans.
Only about 45 companies (less than 2%) received negative "say on pay" votes
As I have noted in prior posts (most recently here ), plaintiffs’ lawyers have rushed to filed “say on pay” lawsuits, either after a negative vote on the advisory shareholder vote on executive compensation, or more recently before the vote occurs based on alleged deficiencies in the...
Governance Insight Alert
Just before the holidays, Freeport McMoRan Copper & Gold (FCX) announced that it had torn up its employment agreement with its CEO, Richard Adkerson, who would henceforth be employed “at will.” FCX is no stranger to pay controversy, having lost two of its three...