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February 26, 2009 Forum Report:

Immediate Requirement of 300+ "Say on Pay" Resolutions



For the Forum's subsequent establishment of a project to support constructive marketplace responses to the SEC requirements reported below, see:



Forum Report


Immediate Requirement of 300+ “Say on Pay” Resolutions


            The SEC updated its Compliance and Disclosure Interpretations today relating to Section 7001 of the American Recovery and Reinvestment Act of 2009, which requires a few hundred TARP recipients to “permit a separate shareholder vote to approve the compensation of executives, as disclosed pursuant to the compensation disclosure rules of the Commission,” clarifying its position that the requirement will be applied to any recipient company filing its proxy statement after February 17, 2009.


This sudden requirement of “Say on Pay” has stimulated some Forum participants to suggest our development of model language for a resolution form.  Although the Forum has occasionally presented forms of resolutions as examples to illustrate a concept – one case being the introduction of advisory voting in 2006, as reported with an accompanying sample resolution in section #2 of the Forum Report on an open meeting of its Options Policies program) – it has not been a Forum practice to provide the kind of compliance support that’s offered by professionals or their associations.  It has also been the Forum’s policy to encourage independent rather than conformed actions of its participants.


Other Forum participants are directing attention to the next steps beyond the drafting and presentation of resolution forms, anticipating the need to consider and vote on what’s presented.  This is of course what we’d begun to address.


With this focus on what the Forum can appropriately and effectively do, your suggestions of a project to support an orderly, sensible response to the new ARRA requirements will be welcomed.


           GL – February 26, 2009


Gary Lutin

Lutin & Company

575 Madison Avenue, 10th Floor

New York, New York 10022

Tel: 212-605-0335






This Forum program is open, free of charge, to anyone concerned with investor interests relating to shareholder advisory voting on executive compensation, referred to by activists as "Say on Pay." As stated in the posted Conditions of Participation, the Forum's purpose is to provide decision-makers with access to information and a free exchange of views on the issues presented in the program's Forum Summary. Each participant is expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

The organization of this Forum program was supported by Sibson Consulting to address issues relevant to broad public interests in marketplace practices, rather than investor decisions relating to only a single company. The Forum may therefore invite program support of several companies that can provide both expertise and examples of performance leadership relating to the issues being addressed.

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The information provided to Forum participants is intended for their private reference, and permission has not been granted for the republishing of any copyrighted material. The material presented on this web site is the responsibility of Gary Lutin, as chairman of the Shareholder Forum.