In response (apparently) to my blogs this week arguing that preparing for SSOP in 2012 is just as critical as it was it 2011, a dear client of mine wrote in to say, essentially: “A pox on you, Melbinger. We don’t even have a Say on Pay vote in 2012 because you helped us achieve a shareholder vote in favor of biennial [SSOP].” To which I replied with an old Johnny Carson line: “Wrong again buzzard breath.”
You may think that the heat is off for 2012, but that it is not necessarily true. The reason is that, with no SSOP resolution to vote on, if ISS or other shareholders or shareholder advisors feel the need to complain about your compensation for any reason, their only alternative is to do so by voting against or withholding votes from your directors, particularly directors on the Compensation Committee. So, the individual Compensation Committee members likely will bear the brunt of ISS scrutiny in “off” years. Therefore, we suggest you still make the effort to be proactive, review and follow best practices, and “sell” your compensation package and policies in the 2012 proxy statement.
Next week, I will begin to describe what I mean by “be proactive, review and follow best practices, and ‘sell’ your compensation package and policies” – the strategy for maximizing the likelihood of achieving a favorable vote on SSOP.
On September 16, 1920, at 12:01 p.m., a bomb in a horse wagon exploded in front of the J. P. Morgan building at 23 Wall Street in New York, killing 38 and injuring 400. The perpetrators of this early terrorist attack were never apprehended. However, investigators and historians think it likely that the bombing was carried out by Italian anarchists (Galleanists), a group responsible for a series of bombings the previous year. Makes today’s class-warfare rhetoric seem calm by comparison.