RI Governance & Engagement, July 28: Manifest survey finds FTSE 100 CEOs’ pay soars

RI’s regular review of governance and engagement news

A survey from proxy voting firm Manifest and pay consultant MM&K has found the median pay of chief executives of FTSE 100 companies rose by 32% to £3.5m last year. Manifest CEO Sarah Wilson told the Financial Times that remuneration committees are developing a ‘tin ear’ about investors’ concerns about pay. Link

Separately, the FT reported that Business Secretary Vince Cable is being called on to make firms declare how much revenue goes to executive pay by the independent High Pay Commission, set up by the campaign group Compass and the Joseph Rowntree Charitable Trust. Link

Shareholders approved a $5.9m (€4.1m) pay deal for asset manager Legg Mason’s Chairman and CEO Mark Fetting in an advisory vote this week, according to the Baltimore Sun. The motion had 87% support, despite proxy voting firm Glass Lewis recommending a vote against the pay package.

The Japan Investor Relations Association (JIRA) has released a survey on changes in annual shareholders’ meetings, investor relations and disclosure. JIRA found that 60% of respondent companies answered questions about the impact of the earthquake earlier this year; and 60% disclosed shareholder voting results on their corporate IR websites. Some 40% conducted analysis of resolutions that had a large percentage of dissenting votes.

The Irish Funds Industry Association, the representative body for an industry which services assets worth over €1.8trn in more than 10,700 funds, has issued a draft Voluntary Industry Corporate Governance Code for investment funds and management companies. It is planned that the code will be adopted on a comply or explain basis from September.

European banks will have to disclose more details about how many of their staff earn more than €1m under proposals from the European Commission, according to a report in the Financial Times. The idea was one of a set of proposals outlined by the Commission earlier this month.The US Securities and Exchange Commission has delayed its vote on whether institutional investors should have to disclose how they voted on say-on-pay proposals at company annual meetings. The Dodd-Frank Act-related rules would oblige so-called 13F filers to disclose their voting in filings.

A US private shareholder, Lewis Wilder, has begun a class action against News Corp. in the wake of the phone-hacking scandal, according to reports. The Sydney Morning Herald said the case has been filed in New York and is the first federal-level lawsuit against the media giant.

The Co-operative Asset Management says there’s been a 58% rise in companies approaching it proactively for one-to-one meetings ahead of annual and extraordinary general meetings to discuss remuneration and sustainability disclosure.

Proxy voting website Moxy Vote has argued against claims of shareholder apathy over say-on-pay votes. “After seeing some of the shareholder resolutions pertaining to executive compensation this year and the way that shareholders want to engage with their companies in the future, we’re far from siding with shareholder apathy,” it says in a recap of the 2011 proxy season.

Governance firm ISS Corporate Services has released a white paper Executive Pay Through a Peer Benchmarking Lens which analyses executive pay levels as well as the processes by which companies benchmark their executive pay relative to peers. ISS is part of MSCI’s Institutional Shareholder Services unit.

The Financial Reporting Council, the UK watchdog, is expected to incorporate stock lending and environmental, social and governance (ESG) issues when it reviews the Stewardship Code, according to a reports. Scheme Expert quoted FRC Governance Advisor Jocelyn Brown as saying the council is looking to produce revised principles in the autumn.

GovernanceMetrics International has been tapped by the Wall Street Journal to help it find out who are the best director candidates. It was asked to find the directors on the boards of at least two companies with the highest total shareholder return.