President Obama recently announced executive pay rules and the Globe today reports that "say on pay" where shareholders vote, in a non-binding way, on executive pay has been accepted at 2 Canadian banks with 2 others to vote on the issue shortly. Shareholders will now be able to vote on "top bankers' compensation".
The article notes that, since 2003, "say on pay" rules have been in effect in the UK for publicly trade companies. There has also been a push for legislated rules:
The groundswell of support sends a signal to securities regulators that they should adopt mandatory rules requiring companies to hold votes on executive compensation, Mr. Hawton [Gary Hawton, CEO of Kitchener, Ont.-based Meritas Mutual Funds] said.
"I'd hate for shareholders to have to go company by company to ask for say-on-pay votes," he said. "At some point, the onus falls on regulators to make say on pay mandatory."
These are interesting times and, while probably not that surprising that there has been some "groundswell" in this area, we'll have to see whether the regulators decide to move the country in what appears to be the UK direction.
