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The comments of Mr. Wilcox, below, are presented with his permission, in accordance with Forum privacy rules.

Mr. Wilcox has also provided a copy of questions intended to guide an investor's consideration of information presented in the "Compensation Description and Analysis" ("CD&A") section of corporate proxy statements:



Information Requirements for Investor Decisions

Comments of

John C. Wilcox

Senior Vice President and Head of Corporate Governance, TIAA-CREF


Member of Steering Committee, AFSCME-Pfizer "Working Group" for Advisory Voting

November 13, 2007


The burden of making compensation disclosures clear and understandable should fall on corporate boards, not on investors.


We all know that compensation disclosures are often incomplete, overly detailed, unclear and difficult to relate to performance. The burden of sifting through such poor disclosure certainly falls on investors, but that burden is unrelated to an advisory vote. In fact, investors are obligated to make informed decisions about compensation regardless of the quality of disclosure and regardless of whether there is an advisory vote. I think it is problematical to suggest that investors are more diligent in their analysis of compensation when there is an advisory vote than when there is not.


Efforts to improve compensation disclosure (including the new SEC disclosure rules) are designed to put the disclosure burden back where it belongs – on company boards and compensation committees. The advisory vote should not be seen as burdensome, but as an appropriate means for shareholders to inform companies that their compensation disclosure is inadequate and they’ll have to do better.


I think it is counterproductive for investors to suggest that the advisory vote creates more work for them. Poor disclosure is what leads to more work. Over the long term the advisory vote should help improve the quality of compensation disclosure and lighten investors’ analytical workload.




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