No. of Recommendations: 2
'Thanks to a “say on pay” clause in last year’s Dodd-Frank financial-reform law, the pay of every senior executive of an American public company is now subject to a shareholder vote. So far in this spring’s corporate annual-meeting season, the management has lost such votes at four firms, the most prominent being Hewlett-Packard, a computing giant.'

'Occidental Petroleum, one of three firms that were defeated in the far smaller number of “say on pay” votes held last year, is rumoured to be working on big changes in its pay policies, following criticism of the bounty enjoyed by its chief executive, Ray Irani.

However, says Robert McCormick of Glass Lewis, a firm that advises shareholders on how to vote, some managers are already trying to avert defeat by giving in to shareholder pressure before the issue goes to a vote. Disney, for example, issued a new proxy form (the document describing what shareholders will vote on) that cut the size of its bosses’ golden parachutes, after investors’ grumbles.'

As a current example, Coke is asking shareholders to vote for:
- approval of performance measures under their Performance Incentive Plan
- Approval of performance measures under their Restricted Stock Award plan
- Advisory vote on executive compensation (say on pay)
- Annual frequency of holding the say on pay vote

Hopefully investors will now start making the effort to exercise their votes on 'say on pay' and not just leave it to their brokers/trustees to toe the party line as usual.

Global Gains Home Fool
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