The Advisors' Blog

– Broc Romanek, CompensationStandards.com

Here’s a query recently posted in our “Q&A Forum” (#893):

Does anyone have a sense of what market practice will be with respect to say-on-pay frequency votes this year for companies whose shareholders voted in favor of annual say-on-pay votes last year? I wonder whether companies that recommended in their 2011 proxy statements that shareholders approve say-on-pay votes every three years, but whose shareholders voted for annual say-on-pay votes, might take another shot at getting approval for a vote every three years? Probably only makes sense to do so for certain companies (i.e., close vote last year, or perhaps a significant change in institutional ownership), but there’s nothing prohibiting a company from putting a say-on-pay frequency proposal up for a vote again this year, right?

And here’s how Dave Lynn answered the question:

You are correct, the Say-on-Frequency proposal could be put up for a vote again this coming year if a company elected to do so, as the Dodd-Frank and SEC rule requirement is that the vote be taken at least every six years, but doesn’t prohibit an earlier advisory vote. I would be very surprised to see many company’s trying again on the Say-on-Frequency vote unless, as you say, there was some compelling change in circumstances that would indicate the vote will go the other way.