Stories Below come from our Media Partner 3BL Media - Click their logo or any of the stories for more information
Executive Compensation, Trends, Executive Compensation Survey, Plans
Executive Compensation Introduction
Updated January 2011
The issues surrounding executive compensation – and especially CEO pay -- have been the topics of much discussion in Board Rooms, at Annual Shareholder Meetings and in the media, After a decade of intense debate, efforts to control executive compensation ((under Federal Law) took center stage when the U.S. Department of the Treasury issued interim final rules for reporting and recordkeeping requirements under the executive compensation standards of the Troubled Asset Relief Program (TARP) in January 2009. For the first time, the Federal government was taking a role in setting the compensation at private corporations. The actions resulted in an appointment of an Executive Compensation Czar within the Treasury Department to review compensation packages for companies receiving Federal assistance.
The effort did not stop here; further regulations are to follow with the enactment of the Dodd -Frank Financial Reform Legislation adopted in the Spring of 2010. This comprehensive package of “reforms” is now the focus of new regulations (that have to be developed implementing rules of the road). Unless the 112th Congress repeals parts of the law dealing with exec comp, the Federal government will have some kind of role in the issue. This has been welcomed by activist investors concerned about executive compensation policies and practices, especially at under-performing companies with outsized exec compensation.
In the worst cases, the focus of executive compensation packages has been upon corporate boards that are accused of being unrealistic, indifferent and in collusion with CEOs. What became the worst criticism was the revelation that too many agreements did not tie compensation with company performance.
“Say-on-Pay” became the rallying cry of shareholder groups and social and proxy activists as the hammer and anvil were hot and ready for hammering out reform. The Securities and Exchange Commission enacted rules for publicly-held companies to finally give a voice to shareholders through the proxy process on executive compensation. While the votes are not binding, they do serve to create an atmosphere of greater transparency and accountability of corporate boards to their shareholders.
Still the debate over the rules goes on; matters related to CEO compensation will continue to be the focus of this section. Whether you are located in the “C” suite or are a Corporate Secretary, Board Member, Investor Relations professional, shareholder or activist, Hot Topics Executive Compensation should be a daily stop for news, commentary and research.
Note: The Editors form no judgment about the level of pay and specific compensation of Chief Executive Officers and others in the “C” Suite. The purpose of this section is to fully air the issues surrounding exec compensation issues at shareholder-owned companies.
How much should a CEO or the top executive officers of a publicly-owned corporation be paid? What is a “fair” compensation? Especially when corporations are laying off thousands of workers and outsourcing work to distant lands? When the middle class is under attack – see CNN Lou Dobbs’ commentary on this? The issue of exec comp has become a burning question with an array of forces on all sides of the issue. When the stock market is doing well and “all boats are rising,” the issue is not as much in focus as when companies (or a single firm) is underperforming and the executive compensation is seemingly out of whack. Out of control. Disproportionate to performance. Unrelated to reality. And other battle cries by investor activists, public officials, journalists, advocate organizations, etc.
Consider the case of Home Depot, where the share price fell as the CEO’s pay package rose. Saying goodbye to the CEO, Mr. Nardelli, cost HD more than $200 million. Consider the exiting of the Wonderful Wizards of Wall Street, and their departure comp packages – totaling in the hundreds of millions’ of dollars – as the wreckage they’ve left behind (in the form of sub prime disaster loan portfolios) causes real pain on Wall Street, and on Main Street. We still don’t know the damage they caused with their financial wizardry – but the carnage is felt when home foreclosure rates increase dramatically, as they have over the past year.
So – what is a fair price for the Top Man (and a tiny handful of Top Women)? You’ll find news, commentary, research and other useful content here in this Hot Topic subsection of Accountability Central, as well as in various content sections and subsections. (See Corporate Governance, Shareowner Activism, Socially Responsible Investment, and other silos.)
Consider this as you formulate your own positions on the pay issues:
Enough highlights and commentary – we invite you to follow the often-heated discussions and public debate on executive compensation here in the pages of Accountability Central.
“…People will be accountable and responsible…”
President Barack Obama – on CEO Comp – February 4, 2009
Latest on Executive Compensation
Source: Corporate Counsel
Behind closed doors, what are corporate board members saying—or not saying—about cybersecurity, executive compensation, and social media? For this we turn to the results of the “2013 Law in the Boardroom” survey of some 550...
Bloomberg - Five of the ten best-paid finance chiefs last year work in the technology industry, as executives at companies from Apple Inc. (AAPL) to Google Inc. (GOOG) were rewarded for increasing profit, amassing cash and...
Source: News Observer.com
Laurence Fink, the 60-year-old CEO of Wall Street money manager BlackRock Inc., wants the retirement age raised to 70. In one TV interview, he explained that we could all wait a few more years before collecting Social Security...
Charlotte Observer - It includes the CEOâs salary, bonus, perks, changes in pension accruals and the current value of ... Each was also represented on HR Policyâs board last year. Except for McDonaldâs, none...
NewsMax - Top corporate executives are getting richer than ever as regular workers suffer pay scale setbacks, according to a report by Bloomberg. Fortune 500 chief executive officers now make 204 times what regular workers bring...
Source: Money News
The Federal Reserve is apparently having some success in its campaign to curb compensation for executives of financial services firms. The Fed’s aim is to prevent banks and other companies from taking excessive risks in order to...
April 23, 2013 Wal-Mart CEO Duke’s Pay Rises to $20.7 Million Last YearSource: Bloomberg
Wal-Mart Stores Inc. (WMT) Chief Executive Officer Mike Duke got a 14 percent raise in pay to $20.7 million as the retailer, trying to recover from a weak start this year, tied future bonuses to compliance controls.
April 22, 2013 Reckless bankers should pay punitive damages
The Guardian - You applaud James Crosby's "conscience" in offering to surrender his knighthood and forgo a sliver of his enormous pension ("Let us applaud HBOS's Crosby for having a conscience", Business). But the "public...
April 22, 2013 Daring to Knock on the Boardroom DoorSource: Gretchen Morgenson, NY Times
STEVEN ROMICK didn’t set out to be a shareholder activist. As managing partner of First Pacific Advisors and overseer of the $11 billion FPA Crescent fund, Mr. Romick has more than enough on his plate. Keeping a low profile is...
April 19, 2013 Corporate Governance and CEO Pay: The Cesspool at the TopSource: Huff Post
Top corporate executives have always been well-paid for obvious reasons. Running a major corporation is a demanding job; you would expect to pay a high salary to get and retain talented hardworking people. But in the last three...
|HOME | ABOUT THE SITE | REGISTRATION INFORMATION | VOICES: FEATURED COMMENTATORS AND BLOGGERS | SPECIAL SECTIONS|