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Tag >> executive pay
According to a report on Reuters, on Monday Treasury Secretary Timothy Geithner said that the government should not be involved in setting corporate executive pay levels.
What impact, if any, this will have on how regulation of compensation plays out is unclear, but it does once again bring to the fore the arguments on both sides of the executive pay discussion.
To follow up on Steve Taub's blog from the other day, more companies are running into resistance from shareholders to what they see as excessive executive compensation.
True, the latest rebellions are occurring in the UK, but governance practices increasingly know few boundaries, or at least find the pond not much of one.
Posted by Stephen Taub in shareholders, shareholder acttivism, Securities and Exchange Commission, Sarbanes-Oxley, Merrill Lynch, executive pay, executive compensation, directors, compliance, CFO, CEOs, bonuses, Bank of America
Bank of America's agreement to pay $150 million to settle SEC charges also includes a bunch of corporate governance goodies designed to satisfy the activist shareholder set.
, of course, told you all about the settlement when it broke last week. The deal stems from charges that the financial giant failed to properly disclose employee bonuses and financial losses at Merrill Lynch before shareholders approved the merger of the companies in December 2008. Bank of America also said it entered into an agreement to settle charges with the Office of the Attorney General for the State of North Carolina related to the Merrill Lynch merger.
Of course, the proposed settlement will be submitted for approval to the Honorable Jed S. Rakoff of the United States District Court for the Southern District of New York. This is the same judge who last year rejected the original $33 million settlement.
One of the most influential shareholder activists has publicly identified its 2010 targets.
The American Federation of State, County and Municipal Employees, AFL-CIO (AFSCME) Employees Pension Plan said it has trained its cross-hairs on 33 companies with proposals that include old, familiar issues--creating independent board chairmen and holding a so-called Say on Pay vote. Other measures seek to end practices that surprisingly exist in the first place, especially in this new age of populism and anti wealthy people.
Activist investors are starting to stir on the eve of the 2010 Proxy Season. And, not surprisingly, they have trained their cross-hairs on executive compensation, which has become a lightning rod for the Obama Administration.
The SEC also implemented a number of changes for this year that should result in more details and clarity in the proxy related to what exactly the top five compensated executives earned last year.
Well, so much for pay for performance.
According to new research, the top five executives at ten of the biggest recipients of government rescue funds have profited mightily off their latest stock option grants. The Institute for Policy Studies says the total value of those options have gone up by $90 million so far this year.
Just in case you thought there was any significant relationship between executive pay and performance at banks receiving Troubled Asset Relief Program (TARP) money, a new study should put the nail in that particular delusion.
It shows that, while absolute levels of compensation for CFOs (and CEOs) fell at some banks from 2006 to 2008, there was no measurable link between pay and changes in performance for the group as a whole.