The resolution, introduced by investors, would
give shareholders an annual, non-binding vote on executive
pay. However, the company said the vote was too close to
make a definitive call and that the final result would be
announced in the next few weeks, according to Reuters.
The proposal follows complaints that investment returns for 2006 were not enough to justify Chairman and Chief Executive Ivan Seidenberg’s total compensation package, which was $20 million in 2006, according to the Securities and Exchange Commission (SEC). The company said that even if the proposal was adopted, it would not be binding; however, Seidenberg said he would take the proposal into consideration, it said.
The move by Verizon investors walks the same path as other actions taken by big-company shareholders around the country.
Proposals to give the shareholders at Morgan Stanley and The Bank of New York more influence in terms of executive compensation didn’t garner enough shareholder support in April, when 37% of Morgan Stanley investors and 47.3% of BNY investors supported the measures (See Shareholders Say Nay To Pay Say ).
The U.S. House of Representatives voted last month to
give shareholders a non-binding vote on executives’
compensation and a separate advisory vote on pay packages
being negotiated for top executives in connection with
mergers or other acquisitions (See
House OKs Bill Over Non-Binding
Shareholder Vote on Executive Pay
The legislation, introduced by Representative Barney Frank, D-Massachusetts, was described as building on the Securities and Exchange Commission’s (SEC) executive pay disclosure rules to require that public companies include in their annual proxy the opportunity to vote on the company’s executive pay plans (See New Executive Compensation Disclosure Rules Take Effect )
According to a press release from Verizon Communications Inc. over the weekend, the firm said preliminary results of the shareholder vote at Verizon’s annual meeting indicated that the following shareholder proposals were defeated:
- eliminating stock options, approximately 9%
- shareholder approval of future severance agreements, approximately 47%
- compensation consultant disclosure, approximately 47%
- limit service on outside boards, approximately 12%
- shareholder approval of future poison pill, approximately 19%
- report on charitable contributions, approximately 14%
Verizon said that preliminary results for the proposal on an advisory vote on senior executive compensation are too close to determine whether the proposal passed or was defeated. The outcome will be determined by the final tabulation.
The final results will be tabulated, certified by the independent election inspectors and posted on Verizon’s Web site ( www.verizon.com ).