In case you haven’t tuned in lately, Nell Minow and the crew at ValueEdge Advisors continue to crank out some interesting posts. Yesterday a brief comment on the SEC Chair on Board Diversity and a few days ago Koch Brothers’-backed ALEC wants dark money image makeover.
Frequently, they are posting more extensive original material, such as Phil Gramm’s Views on CEO Pay Are Ignorant and Insulting.
Yesterday, in testimony before the House Financial Services Committee, former Senator Phil Gramm called objections to inflated CEO pay and calls for better disclosure “bigotry against the successful.”
He also said that the $75 million retirement package for Ed Whitacre at AT&T (it was more like $137 million) was “an outrage” — because it was not enough, describing him as “exploited.”
This testimony is astonishingly boneheaded, considering that it comes from a former Congressman and Senator who got to see what corporate failure looked like with the collapse of Enron, located in his state and with his wife, Wendy Gramm, on its board…
The data on CEO pay show that the ROI for investors is poor, pay is not tied to performance, and shareholders who object to the structure of pay plans have no recourse beyond symbolic “no” and “withhold” votes.
No one wants companies to succeed more than their investors do. That is why they entrust their money to the executives. Someone needs to explain to Gramm that if CEOs get to pick the people who set their pay, it is not the executives who are being exploited.
Of course, my answer to CEO pay — at least an important aspect — is proxy access. Let shareholders pick at least a couple of people who can help set CEO pay. Be sure to check out the comments as well.
I also liked Will Hillary reverse Bill on 162(m)?:
Hillary Clinton is making bad corporate management a campaign issue, saying the CEOs of public companies are so focused on short-term results they undermine their companies’ long-term growth. In a speech Friday, she signaled that she’ll try to roll back a provision of the tax code which she referred to as “an effort in the 1990s to tie executive compensation to corporate performance, including through the use of stock options.
If she was being a bit delicate about the origins of that provision, there was a good reason: it was Bill Clinton’s policy….Unfortunately, the plan didn’t work as Bill Clinton hoped… Econometric studies that compare companies that use more performance pay to those that use less have repeatedly found that performance pay does not improve performance.
Last, in my quick review: CVS Health Quits U.S. Chamber Over Stance on Smoking – The New York Times.
What is especially illuminating here is that apparently they had no knowledge that the Chamber was spending its resources and risking its own reputation on thwarting tobacco regulation and disclosure around the world.
What else isn’t the U.S. Chamber telling its members? Maybe it is time for the Green Chamber of Commerce or some other alternative. More from SourceWatch.org.
Comments are closed.