So Far in Proxy Season, 32 Companies From Russell 3000 Fail Say-on-Pay Votes

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By Yin Wilczek

June 12 — As of June 10, 32 companies in the Russell 3000 index have failed their say-on-pay votes this year, according to Semler Brossy LLC.

In its latest update, the executive compensation consulting firm said that 1,574 Russell 3000 companies have held their say-on-pay votes, of which 93 percent are passing with above 70 percent support.

According to the firm, the companies that recently failed their votes include Astoria Financial, Basic Energy Services, Vertex Pharmaceuticals and W.R. Berkley.

The consultant also noted that thus far, the average vote result is 92 percent. It added that at the same time last year, 42 Russell 3000 companies (or 2.2 percent) had failed their votes.

Director Votes

Meanwhile, Semler Brossy also examined director election votes for Russell 3000 companies from 2013 to thus far in 2015 to determine any relationship to say-on-pay outcomes. It found that more than 90 percent of director elections received vote support above 85 percent and only one out of 200 elections failed.

The firm also found that in the year after a failed say-on-pay vote, compensation committee nonchair members are four times more likely to receive a “withhold” or “against” recommendation from Institutional Shareholder Services Inc.

To contact the reporter on this story: Yin Wilczek in Washington at ywilczek@bna.com

To contact the editor responsible for this story: Ryan Tuck at rtuck@bna.com

The report is available at http://www.semlerbrossy.com/wp-content/uploads/SBCG-2015-SOP-Report-2015-06-10.pdf.