In case you missed it, SEC staff reversed course on a no-action request, clearing the way for Navistar shareholders to vote on a Teamsters’ proposal related to golden parachute agreements, which urges the board to adopt a policy of obtaining shareowner approval for future severance agreements that contemplate paying out more than two times the sum of an executive’s base salary plus bonus. Navistar argued that Dodd-Frank’s say-on-pay vote would substantially implement the proposal’s objective. The SEC staff agreed.
In their request for determination, the Teamsters cited Congressional intent that financial reform requirements not preclude shareholders from taking action on specific elements of executive pay and their request was granted.
Shareowners might do well to contemplate introducing several such limitations on CEO pay at several companies. (see also, CEO Pay in an Age of WikiLeaks: Reporting, Rationale and Ratios and the members-only discussion at USPX.)