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"Say on Pay" Proposals

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August 13, 2009 Forum Report:

Plans for Next Phase of “Say on Pay” Program: Reality

Experiment with policy debate

Developing the resources you’ll need

Supporting competitive success


For an example of the political advocacy organizations referenced below, see



Forum Report: “Say on Pay”


Plans for Next Phase of “Say on Pay” Program: Reality


Your comments will be welcomed to guide the development of plans for the next phase of Forum attention to “Say on Pay” issues, as we focus now on the practical implementation of voting with its associated information and communication processes.

Experiment with policy debate

Before addressing future plans, though, I want to congratulate all the Forum participants who helped define issues relating to public policies.  You should certainly take pride, for example, in the open exchange of views that guided Professor Gordon’s development of recommendations ultimately incorporated in the recent House bill.[1]  Although the Forum was organized to consider marketplace decisions rather than political decisions, it is encouraging to see that our informed discussion of shared objectives can be equally effective in either context as an alternative to partisan advocacy practices.

One of the things we must decide now is whether the Forum should continue its attention to public policy issues.  Those of you with commercial or career interests in the Senate’s treatment of “Say on Pay” or the SEC’s rules for it should of course consider supporting an organization that advocates your particular interests, or even doing your own advocacy.  If your interest is “pure policy” development, you should consider contributing to the programs of one the university governance centers.  But if you think the marketplace might benefit from a non-partisan Forum project, please offer your suggestions.

Developing the resources you’ll need

For most Forum participants, what is really important about “Say on Pay” is the very practical challenge of managing its information and communication requirements.  The increase in these requirements will be significant, even if regulated voting is limited and delayed another year, and the adaptation process will present extraordinary opportunities for corporate managers, investors and service providers to distinguish themselves competitively.  This is the kind of marketplace process the Forum was organized to address.

If you tell us what might help you perform your responsibilities in the new environment, the Forum will organize projects to develop the resources you and other participants need.  These are examples of the range of what is currently being considered, to stimulate your thinking:

      Survey and other investor communication processes for more effective analysis of investor views than what is allowed by proxy voting

      Practices for fair consideration of all investor constituency interests

      Technologies to support more effective delivery and exchange of information

      Neutral clearinghouse for compensation information relevant to both corporate and investor decisions

Supporting competitive success

Participants in the Forum program that initiated the “Advisory Voting Project” in 2006 should recall that the first of three conclusions presented by the panel was that corporate managers and investors share a common interest in the competitive success of their business enterprise.[2]  I want to emphasize now that we also share a common interest in making the most of “Say on Pay.”  However you view the concept or its implementation, the related communication processes will shape what may become the most important consideration in capital allocation and voting decisions: investor confidence that a company is paying its executives to run a sound business.

GL – August 13, 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.

Inquiries about this Forum program and requests to be included in its distribution list may be addressed to

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.