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Working Groups : Corporate Governance : Featured Campaign

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Few issues outrage shareholders like skyrocketing executive compensation. A recent survey of pay for U.S. chief executive officers by Business Week noted that "while average exec pay plunged by a third, the median pay for our 365 CEOs actually rose by 5.9%, to $3.7 million." Learn more here.


 

 

Few issues outrage shareholders like skyrocketing executive compensation, and with good reason.

Skyrocketing Executive Compensation
A recent survey of pay for U.S. chief executive officers by Business Week noted that while average exec pay plunged by a third, the median pay for our 365 CEOs actually rose by 5.9%, to $3.7 million. Other studies show that CEO pay rose from 100 times the average worker wage in 1980 to more than 1,000 times the average worker wage in 1995 (FT 9/19/03).

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What you can do:

Shareholders can request that a company's Board Compensation Committee initiate a review of its executive compensation policies. Write companies in your investing portfolios asking that they:

  1. Compare the total compensation package of top executives and a company's lowest paid workers in the United States in July, 1997 and July, 2007.

  2. Analyze changes in the relative size of the gap between the two groups and the rationale justifying this trend.

  3. Evaluate whether our top executive compensation packages (including, but not limited to, options, benefits, perks, loans and retirement agreements) are excessive and should be modified.

  4. Explain whether the issues of sizable layoffs or the level of pay of our lowest paid workers should result in an adjustment of executive pay to to more reasonable and justifiable levels.