Every day it seems there is another outcry over excessive
executive compensation at public companies. This year, for the
first time, public companies are disclosing ratios of CEO
compensation to median employee compensation, and both the media
and politicians are quick to highlight pay ratios in excess of
1,000-to-one as evidence of everything that is wrong with executive
compensation.
Yet these complaints have a certain air of unreality to them, in
that they don't account for the clearly expressed views of the
people who presumably care the most: stockholders. Stockholders
have been casting non-binding "say-on-pay" votes on
executive compensation for years now, and the data is unambiguous:
stockholders overwhelmingly approve public companies' executive
compensation programs. According to a June 6, 2018 report by Semler
Brossy, in 2018 stockholders have approved 98% of executive
compensation programs submitted for a vote, most often by very wide
margins.
