A year ago, Chesapeake Energy announced that its famously wealthy founding CEO, Aubrey McClendon, was retiring. What it didn’t mention in the announcement was that Chesapeake had received one of the most negative shareholder votes on executive compensation in the short history of say-on-pay in the United States. Only 20 percent of shareholders supported the pay package in June 2012, compared to the 90 percent and better the majority of other companies saw.
Indirect as it may be, Chesapeake’s CEO change may be one of the most tangible outcomes to emerge from the nearly 900 pages of Dodd-Frank Act legislation signed into law in July 2010. Indeed, many regulatory watchers say the non-binding shareholder vote on executive compensation may be the most successful provision of the landmark reform law. Chesapeake’s stock rose in the immediate aftermath of news that Chesapeake was forcing out the entrenched CEO, and it has gone up about 30 percent since McClendon’s successor was named in May.
