May 26, 2009
Royal Dutch Shell’s 59% “No” Vote
– Mark Poerio, Paul, Hastings, Janofsky & Walker
Although I count myself among those who believe that say-on-pay will impose business burdens that outweigh the benefits, this Financial Times article about Royal Dutch Shell’s 59% “no” vote last week has me thinking. The front page article focuses on the “right” concerns in my estimation – holding boards accountable for paying bonuses when financial targets are not met. Here is a related WSJ article.
The financial downturn certainly places a premium on cogent explanations for executive compensation decisions, and the FT article suggests the increasing importance that shareholders attach – globally – to both corporate disclosures and the input of proxy advisory firms such as RiskMetrics.