Say on Pay
Apple yesterday announced that a recount of the proxy votes has revealed that the Shareholder Proposal n.5 has passed and that for next year, the company will implement shareholder “Say on Pay”. I was surprised that this issue has not been picked up by AFB.
For one, I am glad this proposal passed?I had voted for it prior to the last shareholders meeting. Apple has performed well and it’s executives ought to be well rewarded for their hard work; and I am unlikely to vote for a reduction in their reward. I do, however, want to reserve the right to keep in rein executive pay if I feel the compensation committee has run amok. Apple’s current management is talented and does their job well but I don’t know who may be running the company next and I want to keep the possibility of determining the structure of their pay. I would be leery of golden parachutes, rewards based on current share performance (which may mask deep seated problems), or narrowly defined targets.
Part of the problem with most american corporations is an executive board that is too subservient to management and in an effort to attract the best talent often goes way overboard in paying them. Too often pay is awarded on results that are promised, not actually achieved. A more diligent shareholder, who may actually have a “Say on Pay”, may actually attract good management, not those who are well connected.
This is good news on corporate accountability. While shareholders have no role in daily management (thus the liability limit to the extent of investment), disclosures are prudent and I’m hopeful this will become a national trend.
This information is helpful to shareholders in making decisions about board composition, the one major task reserved for shareholder input and consent.
Someone had already posted about “Say on Pay” and commented is a big news, I can’t remember which thread. I find many redundant postings and linking even in the same thread. Many careless readers around.
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