Report Update: Thirteen Additional Companies Fail Say on Pay—Featuring Reasons for Say on Pay FailureZoom inDownload PDF
Our special topic this week features reasons for Say on Pay failure. We have examined the 21 companies that have received less than 50% vote support on Say on Pay thus far in 2015 to assess probable reasons for failure. We found that poor pay for performance relation continues to be the most frequent reason for failure but that failure due to problematic pay practices has declined in 2015 compared to previous years. Our data also shows that while the percentage of companies failing Say on Pay in 2015 is relatively consistent with prior years, the number of probable reasons for failure has declined from an average of four in 2014 to an average of three in 2015. To date 1,232 Russell 3000 companies have had their Say on Pay votes and 93% are passing with above 70% support. Thirteen companies have failed Say on Pay since our last report: Acacia Research, BankUnited, Carriage Services, Darling Ingredients, Dynamic Materials, Hospira, Insulet, Kate Spade & Co., Knoll, Luminex, Mack-Cali Realty, SPX, and Superior Industries International. Proxy advisory firm ISS is recommending ‘against’ Say on Pay proposals at 9% of companies.