A
study of the nation’s largest institutional investors says that the
“majority” of them do not support “say-on-pay” efforts to require
shareholder votes on executive compensation, according to the Center on
Executive Compensation, which says it is “dedicated to developing and
promoting principled pay and governance practices and advocating
compensation policies that serve the best interests of shareholders and
other corporate stakeholders.”
In fact, “only a quarter of
the institutions” queried were in favor of say-on-pay proposals.” The
study also claims that large institutional investors are “not generally”
concerned with the level of executive pay, provided it is “clearly and
appropriately linked to company results.”
The study, which was
conducted by Cornell University professor Kevin Hallock who held
“one-on-one interviews with senior representatives from 20 of the 25
largest investors”, is now subject to criticism, according to an
article posted at workforce.com that contained allegations that the
newly formed association that commissioned the survey is a “front group”
that “represents executives in the compensation debate”.
The Web site for the Center
on Executive Compensation states that:
“In today’s
emotionally charged world of executive pay,” states the center’s Web
site, ” the Center believes that a reasoned voice on the proper design
and governance of executive compensation is needed to ensure that
today’s cure for yesterday’s curse does not become tomorrow’s crisis.”
Other findings of the
survey were that about three-quarters of the investors had no real
concerns about current levels of executive pay, and less than half said
they think compensation consultants should be independent.
Also, one-third of the
survey respondents raised “unsolicited concerns” over the influence of
proxy advisory services have on the proxy voting process, including
compensation matters.