Say on Pay 2010

Example of resolution from Wells Fargo - voted by investors as best corporate governance (and best IR, etc.)

Copied below is the example of a TARP-required “Say on Pay” resolution from Wells Fargo, the company that was voted as having the best corporate governance in an independent survey of more than 3,500 buy-side and sell-side analysts and portfolio managers conducted for the annual IR Magazine US Awards

(Wells Fargo also won the votes, impressively, for best overall investor relations for a mega-cap company, best investor relations officer, best communications with the retail market, and best M&A investor relations.)

Non-TARP examples of resolutions: Intel & Verizon

Examples of advisory voting resolutions were included in SEC proxy filings yesterday by two non-TARP companies that have voluntarily adopted “Say on Pay.”

Intel, which is a Leadership Supporter of the Shareholder Forum’s “Say on Pay” program and represented on its panel, presents its resolution as Proposal 5, “Advisory Vote on Executive Compensation,” starting on page 64 (on PDF page 60, which has been bookmarked):

Intel Corporation, Preliminary Proxy Statement, filed March 23, 2009

Verizon, which is the subject of a Forum program conducted with the New York Society of Security Analysts to examine executive compensation as effective “guidance” of management's expectations relating to performance targets, presents its resolution as Item 3, “Advisory Vote Related to Executive Compensation,” starting on page 14 (on PDF page 15, also bookmarked):

Verizon Communications, Inc., Definitive Proxy Statement, filed March 23, 2009

Your views of these pioneering examples will be appreciated.  - Gary Lutin

Draft resolution from a large TARP firm

This example of a large TARP recipient’s say on pay resolution is from a draft preliminary proxy passed on by Timothy Smith, senior vice president of the environmental, social and governance group at Walden Asset Management. As Smith points out, common language is starting to appear in company proxies.

MBIA letter to shareholders

MBIA issued a press release announcing it 'will provide an opportunity for our owners to vote on the board's significant decisions on executive pay beginning at the 2009 annual meeting.'

Capital One's resolution – making it simple

For a good example of making it simple, the entire section of Capital One's proxy statement (preliminary) dealing with the required "Say on Pay" vote is copied here.

Suggestions of how it can be made even simpler – for the people presenting it as well as for the people voting on it – will be welcomed.

RiskMetrics Group's second proxy recommends say on pay

From the RiskMetrics Group proxy statement:

Item 3 - Advisory (Non-Binding) votes on executive compensation

The board’s corporate governance principles and guidelines provide that the company’s shareholders will be given the opportunity to vote on an advisory (nonbinding) resolution at each annual meeting to approve the company's compensation discussion and analysis as outlined in the annual proxy statement.

International firms use different language

A number of international companies have also adopted say on pay votes. The language varies from that commonly being used in the US. Here are some examples from the UK and Australia