Facing rising angst over soaring executive compensation, companies are increasingly putting forward voluntary plans to give their shareholders a so-called "say on pay."
Supervalu became the latest to do so Thursday, when shareholders overwhelmingly approved a management proposal to hold a non-binding advisory vote every three years on compensation practices.
At last year's annual meeting, Supervalu's board opposed an annual non-binding advisory say-on-pay vote put forward by a shareholder who felt the Eden Prairie-based company's management got paid too much. The measure passed anyway, but Supervalu's board never adopted it and it didn't go into effect.
But like a growing number of companies, Supervalu changed its tune, at least somewhat. Over the past two years, about 70 U.S. companies have voluntarily put forward advisory say-on-pay votes, said Patrick McGurn, special counsel for the shareholder advisory firm RiskMetrics Group.
"You have to put 'quotation marks' on that," he said, referring to "voluntarily." The bulk of those were adopted after shareholders were already pressing for a say-on-pay vote, as was the case at Supervalu, McGurn said.
Minneapolis-based Ameriprise Financial is another example. It adopted an annual advisory say-on-pay vote in response to a "desire expressed by certain shareholders," Ameriprise said in a federal securities filing.
The first vote was held in April, and 79 percent of Ameriprise shareholders approved of the company's executive pay practices.
Shareholder approval is the usual outcome of say-on-pay votes. But earlier this year, executive compensation policies were shot down at Motorola, Occidental Petroleum and KeyCorp., creating a public relations predicament for all three companies.
