Say on pay: Shareholders rarely reject CEO payMay 23, 2013 @ 8:31 am
(AP) - Big U.S. companies are required to offer their shareholders a "say on pay" vote _ essentially, a chance to weigh in on whether they think the CEO and other top executives are getting paid too much.
Shareholders have rejected pay packages less than 3 percent of the time, experts estimate. The votes are non-binding, which means companies don't have to follow shareholders' wishes. But shame has proven a powerful motivator: Companies that get their pay packages rejected tend to change the way they award pay, experts say.
_ THE TALLY: In 2012, 12 companies that were then in the S&P 500 had shareholders reject their pay packages: Abercrombie & Fitch, Best Buy, Big Lots, Chesapeake Energy, Citigroup, Cooper Industries, International Game Technology, Mylan, Nabors Industries, NRG Energy, Pitney Bowes and Simon Property Group.
_ THE EXIT DOOR: Five of those 12 have gotten new CEOs since the 2012 shareholder meetings: Best Buy, Big Lots, Chesapeake Energy, Citigroup and Pitney Bowes. One, Cooper Industries, has been sold.
_ CHANGING THEIR WAYS?: Citigroup, IGT, NRG, Pitney Bowes and Simon Property Group have held their 2013 shareholder meetings. All got approval for their new pay packages.
_ THIS YEAR: Shareholders have voted against the executive pay packages of 14 companies so far this year, according to Glass Lewis, which advises institutional investors on how to vote their shares. That included Apache, which had proposed raising pay for G. Steven Farris by 7 percent to $17.1 million.
(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)
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