Shareholder activists are using the governance restrictions imposed on companies participating in the Wall Street bailout as a weapon to wrestle still more concessions out of those companies in the coming proxy season.
The Treasury Department’s Troubled Asset Relief Program places numerous curbs on executive compensation, from caps on severance packages to clawback provisions considered more stringent than those contained in the Sarbanes-Oxley Act. Hundreds of financial institutions, including the nations’ largest banks, are clamoring for access to TARP’s $700 billion, compensation restrictions and all.
