"The corporate brand is not only used to improve competitive
positioning and express company aspirations, it can also be a powerful
tool to motivate employees."
If the recent "no" Say- on- Pay votes at Motorola and Occidental Petroleum indicate anything, it's that shareholder activism and populist ire regarding executive compensation have real legs. The majority of shareholders at those companies rejected proposed pay packages in a non-binding vote. But those decisions are only the tip of the iceberg, at least as far as changes to executive comp go.
In fact, over the last 24 months, public and shareholder pressure has led one in three Fortune 500 companies to change their executive pay plans, according to Doug Frederick, head of Mercer's Executive Benefits Group, who was quoted recently in Plansponsor.com. And, in case you were wondering, those changes generally haven't involved increases.
"Investors Reject Motorola's Pay Practices," exclaims the headline on the blog posted by RiskMetrics.
The proxy advisory firm said Motorola received just 46 percent support during an advisory vote on its executive pay practices, citing as its source investors who attended the company's May 3 annual meeting.
You have to hand it to Senator Chris Dodd. For someone who has heavily depended on the generosity of the largest banks and investment firms for his fund-raising, he has proposed a pretty impressive bill for further regulating the financial firms....given the current environment in Washington, of course.
I am not confident it will prevent another AIG, Lehman or Bear Stearns. The current poisoned partisanship in Washington on both sides of the aisle wouldn't support that kind of onerous bill.
The shareholder activist set is getting giddy over Say on Pay. They now count 50 companies agreeing to hold a non-binding up or down vote on the compensation table tucked into the proxy at the annual meeting.
This does not include all of the TARP recipients that are required to have annual advisory votes.
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