Tag Archives | CEO pay

Video Friday: SEBI vs Companies Act, 2013

SebiI don’t follow corporate governance in India as much as I would like but this video explains some recent reforms too important to ignore.

To exhort listed companies and their top executives to follow ‘good business practices’, regulator Sebi cleared new corporate governance norms that require them to justify CEO salaries, put in place whistle-blower policies and have orderly succession plans.  Continue Reading →

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Take Action: Comments on SEC Pay Ratio Rulemaking Due December 2

I-Want-Your-OpinionLast week the SEC finally proposed rules to require public companies to disclose the pay ratio between their CEO and their employees, as mandated by Dodd-Frank. Companies would have to disclose the ratio between CEO compensation and the median pay of their employees. Update: Comments due December 2nd.

As reported by the WSJ,  the ratio of “average” pay jumped from 51.6 in 1981 to 319.7 in 2011, according to data compiled by Kevin Murphy of the University of Southern California. The AFL-CIO sampled S&P 500 firms and claims the ratio went from 42 in 1980 to 380.

In response to complaints from multinationals that tallying pay for workers around the globe would be prohibitively expensive, the SEC’s draft largely leaves estimating and sampling methodology up to individual companies. Continue Reading →

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Quick Reads in Corporate Governance

Time to Move Down the Food Chain With Proxy Proposals

How does director voting look so far this year? Eighty percent of directors up for election received over 90% shareholder support. And nine of ten received at least 80% support. Directors of large-cap companies had the highest rate of support, averaging 95% approval. Small cap and Micro-cap directors had the lowest affirmative rates, with 76% voting “for.” Only a very small number of individual directors (less than 2%) failed to receive majority shareholder support.  (From ProxyPulse, a Broadridge PwC Initiative. Much more at the site.) Continue Reading →

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Starbucks (SBUX): How I Voted – Proxy Score 56%

Starbucks ($SBUX) is one of the stocks in my portfolio. Their annual meeting is coming up on 3/20/2013. ProxyDemocracy.org had collected the votes of six funds when I checked on 3/15/2012.  I voted with management 56% of the time.  View Proxy Statement. Warning: Be sure to vote each item on the proxy. Any items left blank will be voted in favor of management’s recommendations. (See Broken Windows & Proxy Vote Rigging – Both Invite More Serious Crime) Continue Reading →

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Reasonable Compensation: We Propose a Role for Investors in Taking on the Income Inequality Challenge

The following is a guest post by Michelle de Cordova, Director, Corporate Engagement & Public Policy, NEI Investments. The article originally appeared on the NEI Investments website and is reproduced here with permission from both the author and the firm. NEI Investments (NEI) is a mutual fund company that “makes excellent, independent portfolio managers accessible to Canadian retail investors through two award-winning fund families: Northwest Funds and Ethical Funds.” It also has Canada’s largest team of in-house socially responsible investing specialists. Continue Reading →

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Broadridge ($BR): How I Voted – Proxy Score 50%

Broadridge Financial Solutions, Inc. ($BR) is one of the stocks in my portfolio. Their annual meeting is coming up on 11/15/2012. ProxyDemocracy.org had collected the votes of two funds when I voted on 11/8/2012.  I voted with management 50% of the time.  View Proxy Statement. Warning: Be sure to vote each item on the proxy. Any items left blank will be voted in favor of management’s recommendations. (See Don’t Let Companies Change Shareholders’ Blank Votes) Continue Reading →

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Hain Celestial ($HAIN): How I Voted – Proxy Score 8%

Hain Celestial Group ($HAIN) is one of the stocks in my portfolio. Their annual meeting is coming up on 11/15/2012. ProxyDemocracy.org had collected the votes of two funds when I voted on 11/8/2012.  I voted with management 8% of the time.  View Proxy Statement. Warning: Be sure to vote each item on the proxy. Any items left blank will be voted in favor of management’s recommendations. (See Don’t Let Companies Change Shareholders’ Blank Votes) Continue Reading →

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Step Into the Corporate Governance Way Back Machine for September

Time to step into the way back machine to see what we were writing about 5, 10 and 15 years ago. Five years ago @ Corporate Governance, I was pleading for readers to send comments to the SEC on their proxy access proposals. 30,000 letters wasn’t enough, in my opinion.

A shareholder proposal calling for a “say-on-pay” vote by shareowners on executive compensation at Activision Inc. (ATVI) filed by As You Sow received 69% of the vote at the company’s annual meeting held in Beverly Hills, California.  This may be the highest vote result so far of about 50 say-on-pay proposals voted on by shareowners this year.  Activision is a publisher of video games including Quake, Doom and Guitar Hero, and is currently all the news for its purchase of Bizarre Creations Ltd., the UK studio behind the popular Project Gotham Racing title. (Activision to Purchase U.K.’s Bizarre Creations, WSJ, 9/27/07) Conrad MacKerron, Director, Corporate Social Responsibility Program at the As You Sow Foundation, criticized the company for providing outrageous perks like paying the mortgages, Medicare taxes, and even pet-sitting for executives.  Continue Reading →

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A New Strategy to Fight Citizens United

Guest post from . Author, ‘The Myth of Choice’; law professor at Boston College. This article is adapted from a more substantial essay in the Fall 2012 issue of Democracy: A Journal of Ideas and appeared previously on Huffington Post, 9/15/2012.

We progressives have been in quite a tizzy about Citizens United, especially now that 2012 election cycle is swamped with Super PAC money. Citizens United, you’ll remember, is the 2010 Supreme Court case saying that corporations have the same rights to engage in political speech as you and I do. In response, a number of progressives have proposed constitutional amendmentsto do away with corporate “personhood.” Continue Reading →
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Video Friday: Clawback Invoked

With the passage of the Dodd-Frank and the Sarbanes Oxley Acts, clawback policies have become increasingly prevalent among public companies. However, it is rare to find a company actually put a clawback policy into effect. Citing Equilar’s findings from the 2012 Clawback Policies Report, we review what a clawback policy is and we examine what triggered one major U.S. bank to put their clawback policy into action. Continue Reading →

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Video Friday: Roger Martin – Fixing the Game

The common belief that firms exists to maximize shareholder value has led to massive growth in stock-based compensation for executives and a naive and wrongheaded coupling of the “real” market (the business of designing, making and selling products and services) with the “expectations” market (the business of trading stocks, options and complex derivatives). It’s a bit like confusing winning the Super Bowl with winning a bet on the Super Bowl. Continue Reading →

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De-emphasizing Pay for Performance

It is common knowledge that people are not driven solely by the prospect of financial rewards. Yet, in business, motivational tools for top executives—particularly the CEO—almost singularly comprise financial incentives. In 1980, only 10 percent of the UK’s largest FTSE100 companies utilized incentive arrangements (in the form of cash and stock-based variable pay). Today, they are universally employed as a matter of best practice and variable Continue Reading →

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CII Contract with Equilar a Positive Step But More Needed to Address Pay Issue

Equilar, the leading provider of executive compensation benchmarking and research solutions, announced the release of its Pay-For-Performance Analytics suite yesterday, along with the fact that the Council of Institutional Investors (CII), whose members hold $3 trillion in assets, has signed on as the first client. According to the press release:

By combining an innovative market-based algorithm to identify peer companies with a realizable pay methodology using long Continue Reading →

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