For Immediate Release
Monday, April 19, 2010
AFSCME Employees Pension Plan Opposes Excessive Executive Compensation at American Express and Wells FargoWashington, DC —
The AFSCME Employees Pension Plan today announced it is voting against resolutions to ratify executive compensation at the annual meetings of American Express and Wells Fargo later this month.
“Outlandish, guaranteed executive salaries and bonuses that aren’t tied to performance are unacceptable,” said AFSCME President Gerald W. McEntee, who chairs the AFSCME Employees Pension Plan. “This kind of excessive, guaranteed executive compensation is outrageous.”
American Express and Wells Fargo will hold annual meetings on April 26 and 27 respectively. Their boards have approved compensation plans that increase guaranteed pay, decrease incentive pay and fail to tie incentives to performance. American Express, for example, makes incentive payouts for below median performance. Wells Fargo increased guaranteed 2010 pay by more than tripling base salaries from their pre-TARP levels, immunizing these executives from the risks shareholders face.
American Express Chairman and CEO Kenneth Chenault received $1,250,000 in salary in 2009 (bumped to $2,000,000 in 2010), with a $5,250,000 discretionary bonus payment. In August, the Wells Fargo Compensation Committee increased the 2009 annual base salary for John Stumpf, Chairman, President and Chief Executive Officer from $900,000 to $5,600,000.
“We will vote against these management compensation proposals and send a message that shareholders won’t stand for these games,” continued McEntee. “Executive compensation should be tied to performance.”
AFSCME’s “Vote No on Management Say on Pay” campaign has gained significant momentum among corporate governance advisory firms. RiskMetrics Group Inc. and Glass Lewis are the latest to recommend that shareholders of American Express and Wells Fargo vote against the approval of executive pay packages.
“Shareholders now have a say on the pay of executives at over 60 U.S. companies. It is up to investors to use this accountability tool wisely. When pay packages aren’t in the best interest of shareowners, we need to use our vote to oppose them,” concluded McEntee.