The Economist (July 6)
A profound “energy transition is under way: from fossil fuels to clean energy. Of all the oil majors, Shell’s attempts to navigate it…are the most intriguing.” With a $52 billion acquisition of BG Group, Shell became “the biggest listed gas producer” while its oil reserves have dropped “lower than those of its Western peers…. Shell is bolder than its rivals in forecasting huge global demand for clean power over the next 30 years. And it is the only firm to link its executive’s pay to progress in reducing emissions across its operations.”
Tags: BG Group, Clean energy, Clean power, Energy, Executive pay, Fossil fuels, Gas, Oil majors, Reserves, Shell, Transition
Investment Week (April 27)
The Swiss fund house GAM “suffered a shareholder rebellion at its annual meeting, after it attempted to raise executive pay despite making a loss last year.” Only 17.57% of shareholders voted in favor of the report on pay with a majority rejecting it. “The shareholder rebellion came after CEO Alexander Friedman’s pay package increased by more than 20% in 2016, despite profits for the year falling by a third to £120.1m from £197.8m in 2015.”
Tags: Annual meeting, Executive pay, GAM, Loss, Rebellion, Shareholder, Switzerland
Businessweek (March 4)
“The Swiss government must figure out how to translate some of the world’s toughest rules on executive pay into national law and risk an exodus of big corporations after voters overwhelmingly backed new curbs in a referendum.” In addition to giving shareholders a binding vote on executive pay, the measure will crack down on golden handshakes and golden parachutes.
Financial Times (June 20)
In the UK, “pay packages for FTSE 100 chief executives have quadrupled since 1998—from an average of £1m to £4.2m.” Shareholders have responded with “rebellions” at major companies including Aviva, Barclays and WPP. Now Business Secretary Vince Cable is also taking aim, promising “the most comprehensive reforms of boardroom pay for a decade by giving shareholders binding votes on pay policy and forcing companies to make executive pay more transparent.”
Tags: Binding vote, Executive pay, FTSE, Shareholders, UK, Vince Cable
Financial Times (May 5)
“A wave of shareholder insurrection is going through the corporate world…. In the past three weeks, managers have faced rebellions against executive pay packages at UBS, Citigroup, Credit Suisse, Barclays, Xstrata, Aviva, Trinity Mirror, and Inmarsat…. This ‘shareholder spring’ has, like the Arab version, cost executives their jobs.” Shareowners are finally “waking up to the fact that ‘pay for performance’ too often translates into pay without the performance to match.” Non-binding “say on pay” votes are shaking things up, but “shareholders deserve more clout. Approval votes on executive pay should be made binding.”
“A wave of shareholder insurrection is going through the corporate world…. In the past three weeks, managers have faced rebellions against executive pay packages at UBS, Citigroup, Credit Suisse, Barclays, Xstrata, Aviva, Trinity Mirror, and Inmarsat…. This ‘shareholder spring’ has, like the Arab version, cost executives their jobs.” Shareowners are finally “waking up to the fact that ‘pay for performance’ too often translates into pay without the performance to match.” Non-binding “say on pay” votes are shaking things up, but “shareholders deserve more clout. Approval votes on executive pay should be made binding.”
Tags: Binding, Executive pay, Non binding, Say on pay, Shareowners
Boston Globe (October 8)
The Globe points to “a distressing pattern for executive pay.” It always goes up. “In the economic-meltdown year of 2009, CEO salaries at publicly traded companies based in Massachusetts rose by a cushy 8 percent, even as many of the companies suffered disappointing returns.” In the future, the CEOs will ask for another raise when profits improve. Executive pay has become detached from executive performance. The Globe calls on shareholders to exercise their say-on-pay votes to correct the situation.
Tags: Executive pay, Say on pay, Shareholders
Financial Times (June 28)
TSE-listed companies are now disclosing the salaries of individuals earning more than 100 million yen. This is a welcome step. Despite the uproar, it’s natural that heads of global groups, such as Nissan or Sony, receive greater pay than executives focusing on the domestic market. In fact, the Financial Times hopes even “greater pay differentials” will result. Managers that generate cash, rather than just hording it, deserve higher salaries. During 2010, Japanese companies are expected to generate less than half the return on equity of other stocks in the developed world. Higher salaries could “be both useful and justified” in raising corporate performance.
Tags: Executive pay, ROE, TSE
