As I’ve blogged before, the United Kingdom has been on a path to revise its executive compensation laws to rein in excessive pay. Yesterday, the UK announced a slew of proposals that would push the envelope in the executive pay area – here are the proposals (or the closest thing I could find to them), as well as British Business Secretary Vince Cable’s oral statement, a summary of responses to the related discussion paper and a comparison with the High Pay Commission’s report that came out a few months ago (note that the HPC is not an independent commission; it’s a left wing charity). And here is a Towers Watson memo, ISS blog and NY Times article discussing these proposals.
The proposed major changes include:
- Say-on-pay votes would be binding
- Approval threshold increased to 75% from 50%
- At least two compensation committee members would have no prior board experience
- Clawbacks of bonuses if executives failed
- Enhanced disclosures
It’s notable that Britain’s opposition party is quoted in media reports as criticizing these proposals as not going far enough! Is this looking at tea leaves for the US? Remember Australia’s new “two strikes” law…
New Shareholder Initiative Seeking Disclosure of Lobbying
Here’s something that I blogged last week on our “Proxy Season Blog“: As reflected in this press release issued yesterday, AFSCME has filed 40 shareholder proposals urging companies to report on lobbying expenditures, including indirect funding of lobbying through trade associations. This is an extension of the activist movement in the political contribution transparency area that is the hottest governance topic this proxy season – but instead of seeking information about how a company may be involved in influencing elections, these proposals seek transparency about how companies seek to influence regulation and laws.
The press release includes a sample of AFSCME’s shareholder proposal and supporting sample at the end, as well as a list of the companies that have received the proposal so far.
Proposed Legislation: Disclosure of Corporate Political Contributions
As Pat McGurn noted during yesterday’s proxy season webcast (audio archive available), political contributions is the hottest topic of this season. Not only shareholders are interested in this topic, but politicians as well (see Keith Bishop’s blog about a new bill that would mandate corporate political disclosures). With so many members asking questions about how their companies need to rethink their political contribution policies and procedures so they don’t violate pay-to-play or other laws or run afoul of what their major shareholders demand from them, I just scheduled a webcast – “The Exploding World of Political Contributions” – that will be held in two weeks.
Webcast: “Alan Dye on the Latest Section 16 Developments”
Tune in tomorrow for the Section16.net webcast – “Alan Dye on the Latest Section 16 Developments” – to hear Alan Dye of Section16.net and Hogan Lovells discuss the most recent updates on Section 16, including new SEC Staff interpretations and Section 16(b) litigation. Try a no-risk trial to catch this program.
- Broc Romanek