Say on Pay

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The latest news, articles and reports on Say on Pay, including insights from Semler Brossy experts on trends and lessons learned from Say on Pay results.

Report update: Four addl. companies fail

We collected results for 120 more companies this week, bringing our total to 1,795 for the season. This week, we found four more companies that failed Say on Pay, bringing our total to 41 (Discovery Laboratories, Sonus Networks, Spansion and Vocus). Year-over-year, results have improved ~1%; companies that failed in 2012 have received significantly more support in 2013 (on average, +40%). Read more

Vote of the Week: Hecla Mining

In our “Vote of the Week,” we discuss Hecla Mining which received 56% vote support in 2013 after receiving above 85% support in each of the prior two years. We had initially reported that Hecla failed in 2013 as the company received 49% vote support at its annual meeting on May 15th. However, Hecla took the uncommon step of adjourning the portion of the meeting pertaining to the Say on Pay vote until June 14th at which time additional voters and others who changed their mind swung the vote to a passing level. This is the first occurrence of a company adjourning their Say on Pay vote to a later date that we are aware of. We will monitor the impact, if any, this action has on other companies and their SOP voting procedures. Read more

Report update: Nine addl. companies fail

We collected results for 136 more companies this week, bringing our total to 1,675 for the season. This week, we found nine more companies that failed Say on Pay, bringing our total to 38 (Big Lots, Consolidated Water Company, East West Bancorp, FTI Consulting, LifePoint Hospitals, Nabors Industries, OpenTable, The Children’s Place Retail Stores, and Tutor Perini). Two companies, Nabors Industries and Tutor Perini, also failed in 2011 and 2012 (joining Kilroy Realty as companies that have failed three consecutive years). Year-over-year, results have improved ~1%; companies that failed in 2012 have received significantly more support in 2013 (on average, +40%). Read more

Vote of the Week: Nabors Industries and Tutor Perini

In our “Vote of the Week,” we discuss Nabors Industries and Tutor Perini. Both companies have failed each of the past three years with Nabors receiving 36% support in 2013, 25% in 2012 and 43% in 2011 and Tutor Perini receiving 38% support in 2013 and 2012 and 49% in 2011. We identified both companies due to commonalities surrounding low support including: high CEO compensation combined with poor TSR performance and declining net income and incomplete responses to address prior and current years’ shareholder concerns. In parallel with the failed Say on Pay votes, two directors at Nabors and one at Tutor Perini were not re-elected in 2013. Read more

Behind the Numbers: Size and Say on Pay

We have been tracking Say on Pay votes since they became mandatory in 2011. One of the things we’ve sensed in 2013 is that companies that are receiving less than 50% support for the vote feel like they’re smaller than in years past. In this post, we have done further analysis to understand whether or not this sentiment is true. Read more

Report update (06/05/13): Healthways and Hercules Technology Growth Capital fail SOP

We collected results for 155 more companies this week, bringing our total to 1,539 for the season. This week, we found two more companies that failed Say on Pay, bringing our total to 29 (Healthways and Hercules Technology Growth Capital). Year-over-year, results have improved ~1%; companies that failed in 2012 have received significantly more support in 2013 (on average, +43%). Read more

Vote of the Week: Kilroy Realty

In our “Vote of the Week,” we discuss Kilroy Realty, which received 22% vote support in 2013 after receiving 30% support in 2012 and 49% support in 2011. Kilroy's reduction in support and third consecutive failure may be attributable to the high value of CEO pay, high target annual incentive values and discretionary nature of the program, dual performance conditions that allow for multiple opportunities to earn performance awards, and amendments to the CEO's employment agreement that increased severance payments upon termination without cause or related to a change-in-control significantly. A proxy advisor also recommended against all directors with the exception of the Chairman of the Board/ CEO. All directors recommended against by the proxy advisor failed to gain election, with an average vote result of 41%. Read more

Report update: 10 new companies below 50%

We collected results for 309 more companies this week, bringing our total to 1,384 for the season. This week, we found ten more companies that failed Say on Pay, bringing our total to 27. These companies include: Alexandria Real Estate Equities, Annaly Capital Management, Atlas Air Worldwide Holdings, Boston Properties, Dynamic Materials, Geron, Kilroy Realty, RadioShack, Strategic Hotels & Resorts, and Ultimate Software Group. Year-over-year, fewer companies are failing Say on Pay (to date, 2.0% of the sample; 2.6% of the sample failed in 2012) and receiving ISS 'against' recommendations (to date, 12% of companies; this compares with 14% of companies in 2012). Read more