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4:02pm 05/30/2008
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,
the "green" theme is playing out (again), with investors calling for an
executive -- maybe even a chairman -- who will push the company in a
new, alternative energy direction. Shareholders vote not to split chairman/CEO roles

But most of the proposals being waged at companies in the form of
"shareholder resolutions" have to do with executive pay. Close to 100
companies are being met with proposals for corporate-governance reform
with regard to executive pay.

This year, a diverse
network of more than 75 investors with over $1 trillion in assets under
management filed shareholder proposals pressing for the advisory vote,
dubbed "say on pay," at more than 90 companies, according to findings
by Boston-based Walden Asset Management.

The firm found
that thus far in 2008 the great majority of proposals that have gone to
a vote have received backing in excess of 40%, with six winning
majority voting support over 50%. Last year shareholders filed more
than 60 "say on pay" resolutions that averaged over 42% support and
included a majority vote at eight companies. "Shareholders continue to
send a clear message that they want an opportunity for an advisory vote
on pay," Walden said.

Timothy Smith, senior
vice president at Walden Asset Management, says "this is an enormous
demonstration of voting support for this governance reform as investors
seek different ways to be heard on compensation." He goes on to say
that "the depth of shareowner support is highlighted by the fact that
companies with no strong concerns on executive compensation, like IBM : International Business Machines are receiving votes in the 40% range in addition to companies that have
faced controversy surrounding their compensation plans." (IBM:

I'm all for investors
having a say in policy -- not micromanaging policy, mind you but a
voice. The "say on pay" proposals do just that and companies should
take up the issue more seriously and give investors the attention they
so well deserve.

Heartening, investors are
coming packing a punch; they are the large institutions that have large
positions in companies' stock. So it's very likely that companies will
indeed take "pay" proposals seriously.

For some reason the executive-pay resolutions are gaining more traction
than the other frequently lobbed investor issue: green policies. These
proposals have much to do with companies putting into practice more
energy-efficient programs and becoming more mindful of their polluting
ways.

In any event, greed is
trumping green for now. However, I expect that to change next season
when investors wake up to the fact that resource inefficiency is
sucking profits.

Meanwhile, compensation
is king of corporate governance and will stir things up. For example,
at Aflac, the first company to put a management-sponsored advisory vote
on the proxy ballot, approximately 93% of investors endorsed the
executive compensation report, illustrating that companies with
reasonable executive pay packages that are tied to performance and
clearly explained are likely to receive strong investor support, Walden
notes.

Such a huge percentage and turnout number means the issue is hot.

"I am encouraged by the breadth of investor support for the advisory
vote reform including state and city pension funds, foundations and
religious investors, individuals, trade union pension funds and mutual
funds," Smith says.

The big guns are out, so
companies may be wise to prune the outrageous sums we've seen over the
past years from compensation packages. Corporate boardrooms beware:
Investors are listening hard and speaking out loud about pay.