Best Buy Co.’s board of directors has made a last-minute appeal to investors to approve the company’s executive compensation program after a prominent shareholder advisory firm urged them to reject it.

In a critical report, Institutional Shareholder Services (ISS) said investors should cast a no vote on executive pay, specifically citing Best Buy’s decision to award stock and cash to CEO Hubert Joly without linking the payments to future performance.

At the heart of the ISS critique is the board’s decision last year to hire Joly and pay him a package worth $20 million. According to the ISS analysis, the board linked only 19 percent of the pay to Joly meeting future performance goals while 37 percent was paid out in cash and immediately vested stock.

“Together, these provisions create the potential for a pay-for-failure scenario,” the report said, noting that shareholders had rejected the company’s pay practices barely a year ago.

But Best Buy argues that the company needed to compensate Joly for the money he lost when he decided to leave his previous job as CEO of Carlson, the travel and hospitality giant. Joly also chose to accept some Best Buy stock in lieu of outright cash, the company said.

“No successful chief executive could be expected to forgo that sum of money for a new opportunity, and it would have been unreasonable for the board to make that demand,” the company said in amended proxy statement filed earlier this week with the U.S. Securities and Exchange Commission.

Best Buy spokeswoman Amy von Walter also said Best Buy’s much improved financial performance under Joly and his leadership team more than justifies the compensation, noting Glass Lewis & Co., another shareholder advisory firm, thinks investors should support the board’s decision.

“There are two clear opinions on this issue,” von Walter said. “One that looks to decisions made nearly a year ago and another that looks to the positive results of those decisions. For us and for many of our shareholders, this is old news and what really matters are the positive results we’ve shown over the last two quarters, results that largely stem from the very decisions in question.”

Shareholders almost always side with the board on executive compensation, especially when the company performs well, and some analysts think the same will be true for Best Buy at its annual meeting next Thursday.

“My sense is that it’s unlikely” that shareholders will say no, said Colin McGranahan, a retail analyst with Sanford Bernstein & Co. in New York. “Best Buy has a new CEO. They are making progress. The market believes in his strategy. The stock price has been up.”

In recommending shareholders approve Best Buy’s executive compensation, Glass Lewis said, “to some degree, such payments [made to executives like Joly] are necessary to respond to the challenges of the past year and position the company for the future.”

Even so, a “no” vote would be an embarrassing setback for the board, said Hillary Sale, a professor of corporate law at Washington University in St. Louis. Last year, investors overwhelmingly rejected Best Buy’s executive compensation program, prompting the board earlier this year to enact some changes that, among other things, would require executives to give back cash should they get fired.

It’s rare for a company to lose a vote on executive pay and even more rare for shareholders to reject executive pay two years in a row, Sale said. And although the “Say on Pay” votes are nonbinding, consecutive defeats would spell bad news for the board, especially directors up for re-election the following year, she said.

The board does not want to take any chances, analysts say, which is why the compensation committee took the extra step of directly lobbying shareholders on the issue.

Executive pay “must also be judged by the results they ultimately deliver to shareholders,” the committee’s letter said.

“In this regard, we hope you are encouraged as we are by what Mr. Joly and the management team have been able to accomplish in the short time since he assumed the CEO role.”

But good financial performance doesn’t always guarantee shareholders will sign off on executive pay.

At Target Corp.’s annual meeting this week, shareholders narrowly approved the company’s executive compensation with only 52.1 percent of investors voting yes, according to SEC documents filed late Friday. That’s a stunningly tight margin for a retailer that has long enjoyed the confidence of Wall Street and a robust stock price.

For companies to claim a clear mandate from shareholders on pay, they need to win at least 70 percent and possibly as high as 90 percent of the ballots cast, Sale said.

Anything lower is as good as a rejection, something Best Buy should keep in mind when the votes are counted next week, Sale said.