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http://www.newsday.com/business/ny-bzca0828,0,3712175.story?coll=ny-business-headlines
CA Shareholders OK Directors' Pay Hike
By Mark Harrington
Staff Writer
August 28, 2003
Shareholders approved a more generous pay package for outside directors of
Computer Associates International Inc., but not before a healthy debate at
the company's annual shareholders meeting Wednesday.
Also on the table at the comparatively sedate meeting: the board's lack of a
woman director, the "razzle-dazzle" of financial presentations, a recent
shareholder lawsuit settlement and even Newsday's coverage of the company.
At the same time, several veteran shareholders praised management and CA's
direction, and, at the urging of chairman and chief executive Sanjay Kumar,
applauded CA co-founder and chairman emeritus Charles Wang, who did not
attend.
The pay package, which triples members' base pay to $150,000 but eliminates
stock options for CA's eight independent directors, was alternately
questioned as excessive and defended as fair given increased workloads.
"I'm very unhappy about the directors' salaries," said shareholder Steven
Speter, who is also an executive vice president of DHR International, an
executive search firm. "It should be relative to what shareholders are
making" on the stock.
While CA stock is down from previous year highs, Kumar noted the stock is up
125 percent since the last annual meeting. He called the board member pay "a
very fair amount."
Shareholders also approved the proposed slate of directors, a group that,
while praised for credentials that include a former SEC chief accountant, a
governance guru and a former U.S. senator, lacked one component.
"I would hope for more feminine faces," said one woman shareholder. "You've
denied yourself 50 percent of the world population and an important
viewpoint." Stony Brook University President Shirley Strum Kenny left the
board last year.
Kumar said the board was already working to fill open slots and added, "I
think it would be phenomenal to have a woman on the board."
That same shareholder, noting the company's $267 million loss last year,
said, "You've razzle-dazzled us today" by painting a positive picture of
finances, even as "expenses still exceed revenue. You've got to do more." CA
reported its first net profit in nearly three years in the first quarter of
fiscal 2004.
Some questioned this week's planned settlement of five years of
accounting-related shareholder lawsuits. The company will issue up to 5.7
million new shares at a charge to earnings of $144 million. But Lorsch said
settling was a "no-brainer," given the potential for distraction and legal
fees. He added the company will "do whatever we have to do" to get beyond
government probes of CA's accounting, ongoing since February 2002.
Criticism and plaudits during the meeting weren't reserved only for CA. One
shareholder, clutching a fistful of Newsday stories, railed against what he
called the "negative" tone of coverage of CA, tore them up and said he would
instead subscribe to Playboy.
Copyright © 2003,
Newsday, Inc. |
