The Advisors' Blog

– Broc Romanek

This new paper from the Stanford Business School & Rivel Research Group reveals the viewpoint of institutional portfolio managers on executive pay practices, finding that investors believe pay should be tied to performance, long-term in focus and aligned with shareholders. Return on invested capital was the most common metric cited by these investors as a good link between pay and performance; stock price was the least common.

Additionally, buy-side investors claim not to be influenced by proxy advisor recommendations – but this research found that investor voting practices are highly correlated with proxy advisor recommendations…