Published Executive counsel - october/november 2011

What's the Takeaway on 2011 Say on Pay Votes?

By Deborah Lifshey and Dana Etra

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, starting in the 2011 proxy season nearly every public company was required to seek shareholder approval of compensation programs for named executive officers in the form of Say on Pay advisory votes.  Despite concern that shareholders might withhold support for programs, given widespread investor and media criticism of some coporate pay policies, upwards of 98% of votes received majority support.

This article takes a closer look at the voting record, including the influence of voting recommendations issued by Institutional Shareholder Services and investor concerns about the link between pay levels and corporate performance at many companies that failed to win majority support.