The Say on Pay continues to play out at US annual meetings this year – both in terms of management and shareholder proposals. Here are a few highlights prepared by Allie Monaco of ProxyGovernance:
- Two management say on pay proposals were defeated at meetings last week. At its May 3 meeting, Motorola Inc became the first U.S. company to have its pay practices voted down with 46% of voting shareholders rejecting the proposal (had abstentions not counted as ‘against’ votes, the proposal would have passed). Four days later Occidental Petroleum Corp met the same fate, when its say on pay proposal received only 47% of votes cast.
- More than 175 management say on pay proposals will be voted through May 31. The average support for these proposals thus far is 87% of votes cast.
Shareholders continue to push the issue, although the number of shareholder proposals has declined. Just over 50 shareholder-sponsored say on pay proposals have made it to the ballot in the first five months of 2010; average support for proposals voted to date is 43% of votes cast for and against. In 2009, 80 shareholder say on pay proposals came to a vote, receiving average support of 45%.
In a rather unexpected move, Norges Bank Investment Management, which runs the Norwegian Government Global Pension Fund, announced last week it had revised its voting policies and will now vote against say-on-pay shareholder proposals. The fund contends that boards and management are “more qualified” than shareholders to set pay, and that “the best way to control remuneration is to elect board members who are capable of representing investor interests and being held accountable for unacceptable practices.”