Lucent Shareholders OK Pay for Performance Recommendations

One proposal, approved with 54% of the votes, requests the board to adopt a policy in which at least 75% of stock options awarded to senior executives be based on “performance criteria adopted by the board disclosed to shareowners,” the Associated Press reported. The proposal narrowly failed a vote last year.

Another proposal, which passed with 53% of the votes, encouraged the board to exclude the company’s pension credit when determining performance-based compensation for its executives. The company has said it already does that.

However, the shareholders rebuffed a suggestion that senior managers get no bonuses until retiree benefits are restored, according to preliminary results of voting released from the company’s annual meeting.

The company said it needed to cut benefits to recover from the telecommunications slump. In 2003 and 2004 it ended health coverage for former managers and dependents and halted a death benefit for the survivors of retirees.

Institutional Shareholder Services recommended support for both compensation measures that passed, observing that Lucent should set separate criteria for short-term and long-term incentives.

The shareholder proposals are  here .