Lucent shareholders vote to restrict executive pay

[mahatmakanejeeves]

It's the way I voted my shares too.

The shareholder meeting was today. Proposals like this are beginning to show up every year, but they almost always lose. This proposal was introduced by a Joanne M. Raschke of Winston-Salem NC, who owns 5,000 shares. She is a member of the Lucent Retirees Organization. If you look at their recommendations, you see that they were totally steamed with the way the company is being run.

Lucent shareholders vote to restrict executive pay

Wednesday 15 February 2006, 3:20pm EST

By Robert MacMillan

NEW YORK, Feb 15 (Reuters) - Shareholders of Lucent Technologies Inc. (LU.N: Quote, Profile, Research) on Wednesday voted to restrict the pay of senior executives by tying 75 percent of their stock grants to the communications equipment maker's performance.
....

The votes reflect investor dissatisfaction with the compensation of Lucent's senior management as the company struggles to grow amid a tough environment for spending on traditional telecommunications equipment.
....

Shareholders also voted in favor of excluding credits from Lucent's pension program as a factor in determining how well executives performed.

Lucent already does not include pension credits as a factor in determining executive compensation, {spokesman Bill Price} said. Credits generated by the company's pension program are reported as non-cash income.

[napi21]

1. HURRAY! Now let's see all other Corps do the same!!!!!

I've been asking for this for YEARS! I don't believe in the gov't capping salaries, and I can't even blame the executives for the salaries they make. If somebody offered me a couple of Million, I'd be shocked, but I'm sure not going to say, naw, that's too much, I don't deserve it!

Nobody be the stockholders can change the out of control salaries that have been awarded over the last 10-15 years!

I'm really thrilled to hear Lucent is the first (I think) to do this, and I hope stockholders
in all the other major businesses do the same!

[mahatmakanejeeves]

2. I was surprised it won.

The news made the PBS program "Nightly Business Report" tonight, and when I heard it, I just couldn't believe it. My mom voted her shares this way too. These proposals almost always lose by a margin of 90% management, 10% angry small shareholders.

It's the same old story. The CEO has options galore, and no matter how poorly the stock performs or the company performs, she makes out like a bandit. Same routine everywhere. I hope this catches on.

[napi21]

3. That means the BIG institutional investors voted for it!

That's why you always see such big wins and losses on proxy votes. I actually stopped voting a long time ago. I don't own enough shares of anything to be more than a single line on a stockholder register!

It's the institutional investors that swing the vote & the market. Companies spend a lot of time wooing those guys to get them to vote in their favor.

This is a very good sign, in my opinion!

[Lasher]

5. Verizon retirees have been making some progress

Retirees Defeat Verizon in Shareholder Proxy Proposal for Third Consecutive Year

March 21, 2005 -- For the third consecutive year, leaders of the Association of BellTel Retirees — an advocacy group made up of retirees from Verizon Communications and its subsidiaries, have succeeded in altering the company’s corporate policies through the proposal of shareholder proxies.

Verizon has agreed to change its corporate policy and adhere to the proxy resolution’s requirement to rein-in Supplemental Executive Retirement Plan (SERP) income for senior executives. In return, the retirees agreed to withdraw the proxy proposal, which in 2004 gained 37 percent of the shareholder vote and won support from groups including CALPERS.

<snip>

Three Other Proxy Victories for Retirees vs. Verizon:

In 2003, Verizon agreed to implement a retiree proposal prior to its annual shareholders meeting to exclude pension credits from the calculation of executive compensation, which gained 43 percent of shareholder votes the previous year. The retirees then went on to shock the company when Verizon shareholders overwhelmingly voted to support another retiree-sponsored Executive Severance Agreement Proposal by a margin of 59 to 41 percent, also in 2003. The non-binding proposal was to limit what retirees call overly-generous executive compensation packages and golden parachutes. It was the first proxy loss by Verizon or any other Bell company in its more than 125-year history.

In 2004, the retirees came back at the company on the previous year’s proposal after Verizon executives and its Board of Directors failed to follow shareholders’ mandate to limit overly-generous executive compensation packages and golden parachutes. This time, when the retirees authored a binding proxy proposal mandating the board to implement the change, Verizon relented, agreeing that the company will seek shareholder approval for any future Executive Severance Agreement more than 2.99 times an executive's base salary and bonus.

http://www.belltelretirees.com/bulletin.htm

[mahatmakanejeeves]

7. Verizon: exclude pension credits from the calculation of compensation

A proposal just like this passed at the Lucent meeting yesterday too.

Much later, the margin by which the proposals passed will be made known. The best place to check will be the Lucent retirees' site, as, by then, this thread will be dozens of pages back.

Keep voting.

[Lasher]

8. Most important of all is interlocking BOD members

The way the game works is, "I sit on your BOD and you sit in mine. I'll vote for all the pay raises you want and you do the same for me." It can get much more complicated that that, but this is the basic idea. CEOs of publicly traded corporations need to be prohibited by federal law from serving as a BOD member - this applies to everything, including nonprofits, and especially to their own companies' boards. Even without interlocks, CEOs have shown a strong propensity to empathize with one another.

Typically, shareholders do not really have a voice in selection of BOD members. They are selected by the CEOs. Most shareholders just get to vote yes or no for one candidate for each seat on the board.

[mahatmakanejeeves]

11. BOD

Typically, the way the Lucent balloting goes is this: you could vote for all the candidates, or you could withhold votes for individual candidates, but you could not vote against any candidates. It was "for" or "withhold." I looked up all the candidates at Open Secrets and withheld my vote from the ones who were contributors to Republicans. Actually, I 'd rather have directors who weren't contributing to any politicians, but that's just me.

[Lasher]

12. That's exactly the way it works with Verizon...

and with every other company whose stock I have owned.

[EC]

4. Finally...

I was wondering when shareholders were going to do this....hope more will follow suit....

[Texacrat]

6. Good for them

n/t

[wordpix]

9. hurray! Way to go, shareholders! The Lucent board didn't want this,

[raccoon]

10. K & R. Yall, let's recommend this one! nt