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Forum Report
TIAA-CREF Hosting Panel on 2009 Test of
“Say on Pay”
TIAA-CREF
has asked me to inform Forum participants of a program they’re hosting and
co-sponsoring with the New York Chapter of the National Association of
Corporate Directors (NACD) next Thursday, April 9, to present an exchange of
corporate and investor views regarding this year’s practical testing of “Say
on Pay.”
A copy of TIAA-CREF’s preliminary invitation is copied
below. They expect to be announcing
panel members during the next few days.
GL – March 31, 2009
Gary Lutin
Lutin & Company
575 Madison Avenue, 10th Floor
New York, New York 10022
Tel: 212-605-0335
Email:
gl@shareholderforum.com
THE ADVISORY VOTE IS HERE, NOW WHAT?
Working Towards Creating a Productive Framework (and a Common Language)
Around Casting and Interpreting “Say on Pay” Votes: A Dialogue Among
Institutional Investors, Company Management and Corporate Directors
Host: TIAA-CREF, 730 Third Avenue, NY, NY, Wharton
Auditorium (between 45th & 46th Streets)
Sponsors: TIAA-CREF, NACD-NY Chapter
Cost: $40 per person for NACD-NY and CII members, $75
per person otherwise
Lunch will be served
Date: Thursday April 9th, 2009
Schedule: 10:00 AM – 1:30 PM – Following a welcome address,
two panels (one before lunch and one following it) will attempt to tackle
the questions below.
Registration: Please visit the following website:
http://nacdny.org/events/2009/event_description_040909.html
Conference Overview:
Since the concept of a U.S. advisory vote was introduced, its
appropriateness, merits, value and purpose have been debated by boards
of directors, company management and investors. Congressional action over
the last several weeks has pushed this concept from theory to action.
Between required votes at TARP recipients, and voluntary company adoptions,
we expect there to be upwards of 300 advisory votes offered by management in
the coming months.
It is now time for the discussion to turn to how an advisory vote can be a
constructive tool for the business and investment communities. This session
is meant to be a starting point for a rational, coherent, above-the-fray
dialogue on the topic, among investors, directors and management. One goal
is to soften the rhetoric that has erupted over executive compensation, in
search of common ground. We do not expect to answer all the questions, and
may likely leave with more questions than we started with. However, we
believe that open and frank dialogue is the best way to ensure we extract
the most value from the significant resources that will be committed to this
vote by the governance community.
Selection of Questions to be Addressed:
·
How are institutional investors going to determine their
votes?
·
How important are the quality of disclosure, the size of the
pay numbers, the type and mix of pay vehicles, and other factors?
·
How should directors and management interpret an Against vote?
·
Will institutional investors’ approaches to Say on Pay be
different next year, assuming mandated, or broader, adoption? If so, how?
·
What are the ten or so items of information that institutional
investors deem most important in making their “Say on Pay” voting
determinations? Should companies seek to provide additional and/or
reformatted information to assist in this regard?
·
What does “pay for performance” really mean in the current
environment? What pay vehicles are best suited to delivering it?
·
Have certain compensation policies and practices become
virtually “toxic” in the current eyes of today’s shareholders? What
limitations should directors be mindful of when setting compensation?
·
What are institutional investors expecting in terms of
management and director engagement with them prior to plan adoption/vote on
pay?
·
Should investors be expected to follow-up an Against vote with
engagement?
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