business

Buoyed by a nationwide uprising among investors burned in last year's calamitous stock market, shareholders at General Mills' annual meeting on Monday narrowly approved a "Say on Pay" measure that would give them a nonbinding vote on executive compensation.

The measure, which follows similar measures passed at other publicly traded companies, including Supervalu, won the support of shareholders who hold 48.44 percent of company shares; those opposed to it, which included the company's board, hold 46.90 percent.

"A high vote at a company like General Mills is not a criticism of the company or the board," said Scott Metz, a regional vice president at Calvert Investments, Bethesda, Md., one of the two primary sponsors of the resolution. Although the resolution passed, it still must come before General Mills' board for approval, which CEO Ken Powell pledged would happen soon.

Such executive pay measures have gained widespread attention in recent months as investors seek a greater voice with board members; a bill before Congress could require such Say on Pay votes at publicly traded companies as early as next year.

Powell was paid $7.13 million in fiscal 2009, which at General Mills ended on May 31. His salary was $959,583, an increase of 13.8 percent over the previous year's $843,333. A year before that, his annual salary climbed 20.5 percent, from $700,000.

Powell's total earnings include his salary plus non-equity incentive pay, exercised stock options, value realized on vesting shares, new stock options and other compensation.

The company stressed that the shareholders resolution was not prompted by criticisms of executive pay.

Shareholder Richard Steege was happy to see the proposal pass, saying he voted for it despite the board's recommendation. His opinion of the CEO and board members' pay? "It's probably a little outlandish."

Steege, a shareholder for 42 years, said he and his wife first invested in General Mills with money she made selling her Volkswagen Beetle in 1967.

Powell, speaking to shareholders before the vote, said sales in fiscal 2009 grew 7.6 percent to $14.69 billion. Earnings were up less than 1 percent, to $1.3 billion, or $3.80 a share. In the fourth quarter, however, the company reported a 94 percent gain in earnings, which was partly attributed to the recession driving customers out of restaurants and into grocery stores in search of cheaper, home-cooked meals using many General Mills products such as Hamburger Helper, Gold Medal flour and Cheerios.

Powell said Monday that the board of directors, acting ahead of Wednesday's expected first-quarter-of-2010 earnings announcement, approved a dividend of 47 cents a share, a vote that continued 111 years at General Mills of uninterrupted dividend payments.

The annual shareholders meeting is when the company shows off some of its newest products, and visitors to the Children's Theatre Company in a residential neighborhood south of downtown Minneapolis were treated to samples of Wheaties Fuel, which hits store shelves in January, along with gluten-free Betty Crocker baking mixes, a light version of Yo-Plus pro-biotic yogurt and Pillsbury Simply cookies, billed as the cookie made from ingredients that consumers would use at home.

The company plans to introduce 150 new products in the first half of 2010, Powell told shareholders.

With commodity prices well below last year's highs, General Mills has lowered some prices, notably the price of flour, Powell told reporters after the meeting. He emphasized the company's value meals with shareholders, pointing out that a serving of Cheerios with milk costs less than 50 cents, while a bowl of Progresso soup with a Pillsbury breadstick costs $1.50 per serving.

Shareholder Tom Olson of Mora, Minn., said he's planning to hold his shares, as he has for 43 years.

"Basically, people have got to eat," he said.

Matt McKinney • 612-673-7329