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After Three Years, Why Are Companies Losing Say-on-Pay Votes?

Joe Mont | May 21, 2013

While many companies have made changes to compensation plans to pass muster with shareholders over the last few years—this is the third year that companies are required to solicit say-on pay votes at their annual meetings—plenty of companies are still getting red-lighted on executive pay.

It' still early in the proxy season, but already the say-on-pay casualties are piling up. Thus far this season, as of May 20, 12 Russell 3000 companies have seen shareholders give a thumbs down to their executive compensation plans, with less than 50 percent shareholder approval: Navistar International; Dendreon; Axis Capital Holdings, Tower Group; Stillwater Mining; Comstock Resources; Gentiva Health Services; Golden Star Resources; Digital Generation; Cogent Communications; Nuance Communications; and Biglari Holdings.

It is not just technical failures of those that get less than 50 percent support that are problematic for companies; many shareholders view anything below 60 percent...

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