U.S. Says Shareholders Need Say In Executive Pay

U.S. Says Shareholders Need Say In Executive Pay - 6/10/2009

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U.S. Says Shareholders Need Say In Executive Pay
Staff Writer

Reuters. June 10, 2009
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EXCERPT: U.S. Treasury Secretary Timothy Geithner on Wednesday said the Obama administration wants Congress to pass new laws giving securities regulators power to force companies to let shareholders have more say in setting executive pay levels. The administration also was expected to name a "pay czar" who would have authority to reject compensation plans for top employees at companies getting "exceptional" government aid, an administration official said. […] Pay packets for executives that sometimes are several hundred times what average employees earn have angered the public since the U.S. Treasury began pumping hundreds of billions of taxpayers' dollars into banks to keep them afloat. Mr. Geithner said Treasury wants Congress to pass two specific pieces of legislation. One would give the SEC authority to oblige companies to give shareholders a nonbinding vote on pay packages for top executives. The other legislative proposal that he said Treasury will offer is to give the SEC power to ensure that internal pay committees, which set pay levels and perks company leaders, are more independent from management. […] Geithner met SEC Chairwoman Mary Schapiro, Federal Reserve Gov. Daniel Tarullo and pay experts at Treasury before speaking briefly to reporters. At Mr. Schapiro's side sat Kenneth Feinberg, whom sources had indicated will be named pay czar. The pay czar, or "special master," will review compensation structures for the top 100 salaried employees of firms receiving exceptional assistance, such as Bank of America, Citigroup and insurer American International Group Inc., the official said. Mr. Feinberg, a respected Washington lawyer, oversaw the government's compensation to the survivors of the Sept. 11, 2001, terror attacks.

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