Beyond the Bailout

Are limits on executive compensation for banks that accept federal funds just the first wave in a future sea of pay measures?

Alix Stuart
- CFO Magazine

The juggernaut that is executive pay seemingly hit a roadblock when
Congress wrote compensation limits into the Emergency Economic
Stabilization Act. As regulators wrangle over how to enforce these
boundaries at banks, a bigger question looms: What do they mean for
everyone else?

Not much, say some. "What we have is a symbolic gesture," since none
of the measures are new and most have big loopholes, says Paul Hodgson,
senior research associate with The Corporate Library, an independent
corporate governance research firm. "I can't see it having a wider
effect."

Others, though, view the limits as a small first step toward a much
broader array of corporate-governance measures designed to give
shareholders more power over executive pay. "We're fully expecting some
form of shareholder bill of rights to come out within the first 100
days of Obama's Administration," says Patrick McGurn, special counsel
to proxy advisory firm Riskmetrics. A mandatory shareholder vote on
executive compensation (or "say on pay") is a given for that bill, he
says, with strong support from House Financial Services Committee
chairman Barney Frank (D–Mass.), but other measures, like proxy access
and more...http://www.cfo.com/article.cfm/12668104?f=msdynamics