Say on Pay

Behind Say on Pay

Behind Say on PayZoom inDownload PDF

We offer insights into Say on Pay vote results, answering questions about what SOP data really means in our “Behind the Numbers” series and diving into the potential drivers of specific company vote results in our “Vote of the Week” reports.

Vote of the Week: Medidata Solutions

Our “Vote of the Week” features Medidata Solutions. Medidata received 43% vote support in 2014 after receiving 98% in 2013. Despite strong shareholder returns, the Company received a year-over-year decrease in support of 55% likely due to high relative CEO pay, significant and identical pay packages for both the CEO and the President, and a year-over-year increase in the CEO’s and President’s pay of 155% ($4.2MM) largely driven by two special awards. Read more

Vote of the Week: Kilroy Realty

Our "Vote of the Week" features Kilroy Realty. Kilroy received 87% vote support in 2014 after failing in each of the three prior years. The Company likely received increased year over year support due to Changes to the annual and long-term incentive plans, increased emphasis on multi-year performance in the long-term incentive plan, continued shareholder outreach, and submission of a proposal to require a majority vote for uncontested director elections. Read more

Vote of the Week: Chipotle Mexican Grill

Our "Vote of the Week" features Chipotle Mexican Grill. Chipotle received 23% vote support in 2014 after receiving 73% in 2013. Despite strong shareholder returns, the Company likely received lower year over year support due to magnitude of combined co-CEO pay levels which is high against peers, annual fixed grants of stock-only stock appreciation rights, and 'Vote No' campaign by CtW Investment Group. Read more

Vote of the Week: Motorola Solutions

Our "Vote of the Week" features Motorola Solutions. Motorola received 98% vote support in 2014 after receiving 68% in 2013. The Company likely received increased support in 2014 for its strong shareholder outreach following lower votes in 2012 and 2013, amendments to the CEO's contract to eliminate the tax gross-up provision and reduce the minimum annual bonus target, lack of special equity awards, and improved performance. Read more

Vote of the Week: Rovi

Our "Vote of the Week" features Rovi. Rovi received 40% vote support in 2014 after receiving 53% in 2013. Despite the changes made by the Company, it likely received lower support in 2014 due to high CEO pay compared to peers, negative 3-yr TSR and declining year-over-year revenue, reduced short-term incentive target goals year-over-year and reduced long-term incentive threshold goals, and above median benchmarking practices. Read more

Vote of the Week: Carnival

Our "Vote of the Week" features Carnival. Carnival received 58% vote support in 2014 after receiving votes above 90% in the three prior years. The decreased support in 2014 is likely due to severance payments to executives upon retirement and a guaranteed minimum bonus provision in a new employment agreement. Read more

Report update: five votes below 50% so far in 2014

We have collected Say on Pay vote results for 113 additional Russell 3000 companies, bringing our total to 347. The average vote result for all companies in 2014 is 92%. Two additional companies failed since last week's report; five companies (1.4%) have failed so far this year. Of companies with four years of Say on Pay votes, 224 (92%) have passed all four years, 16 (6.6%) have passed in three years and failed in one year, two companies (0.8%) has passed in two years and failed in two years, and one company (0.4%) has passed in one year and failed in three years. Proxy advisory firm ISS is recommending 'against' Say on Pay proposals at 10% of companies in 2014. Read more

Vote of the Week: FirstMerit

Our "Vote of the Week" features FirstMerit. FirstMerit received 41% vote support in 2014 after receiving 68% in 2013. The year-over-year decreased support is likely due to CEO pay above median of peers, CEO's frozen supplemental pension (SERP) value of $20.5MM, including a change in value during 2013 of $10.9MM, and discretionary cash bonuses to NEOs. Read more