In three recent no-action letter responses, the staff of the Division of Corporation Finance of the Securities and Exchange Commission advised AT&T Inc. and two other companies that they may not exclude from their proxy statements a shareholder proposal to adopt a policy that included, as a voting item in the proxy statement for each annual meeting, a non-binding advisory management resolution to approve the compensation of the named executive officers set forth in the Summary Compensation Table in the company’s proxy statement and the accompanying narrative disclosure of material factors provided to understand the Summary Compensation Table. (The SEC’s response in the AT&T letter is subject to proof of stock ownership by the proponent of the proposal.)

In addition, on March 1, United States House of Representatives Financial Services Committee Chairman Barney Frank (D-Mass.) introduced legislation to require public companies to include in their annual proxy statements a non-binding advisory shareholder vote on their executive pay plans. The bill also contains a separate advisory vote if a company gives a new, not yet disclosed, “golden parachute” while simultaneously negotiating to buy or sell a company.

AT&T Inc., SEC No-Action Letter, available 2/16/07.