Qwest Votes Against Tougher Comp Policy

June 5, 2002 (PLANSPONSOR.com) - Qwest Communications International stockowners voted against two proposals that would restrict executive pay, at the telephone company's shareholder meeting in Dublin, Ohio, according to an Associated Press report.

A bid by Qwest retirees to mandate shareholder approval of severance packages for the company’s top executives, failed to garner the 51% of shares needed to pass the measure. Only 27% of shares were voted in favor of the measure, despite a letter-writing campaign by retirees to gain support for the move.

A second proposal, one that would omit growth in the company’s pension fund assets from being factored into executive bonus calculations, also lost its vote, securing only 39% of the shares cast (see Shareholders Hit Verizon, Raytheon Exec Comp Rules ).

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Qwest had recommended rejection of both proposals, arguing that the severance proposal would limit flexibility in arranging competitive pay packages for executives.

The cash-strapped company, arguing that pension credits are not a major factor in determining executive pay, denied that the credits have been used to inflate income.

Though recommending that the severance proposal be rejected, Institutional Shareholder Services (ISS), a provider of proxy voting advice to institutional investors, supported the pension proposal.

Board members and executives own 19% of Qwest’s stock.