For Immediate Release
Wednesday, April 27, 2011
AFSCME Urges Shareholders to Vote Against CEO Pay at Alcoa (AA) on May 6 and ConocoPhillips (COP) on May 11
Washington, DC —AFSCME has led the charge to get shareholders of U.S. companies the right to vote on executive pay. Thanks to the Wall Street Reform Act, shareholders now have a voice. “Shareowners are using Say on Pay to register their disapproval of skyrocketing CEO pay,” said AFSCME President Gerald W. McEntee, whose 1.6 million members participate in public pension funds with combined assets worth more than $1 trillion. “Investors can use this tool judiciously and send a clear message to boards of directors: Pay needs to be tied to performance.”
Despite underperforming its peers over one- and three-year time frames, Alcoa raised the total pay of Chairman and CEO Klaus Kleinfeld each year during his three-year tenure. While Kleinfeld earned more than $35 million from when he became CEO in May 2008 until 2010, Alcoa shares lost more than 60 percent of their value during this period.
Although ConocoPhillips is smaller than all of the companies it selected for benchmarking CEO total compensation, its CEO pay is the second highest of the group. In setting total compensation targets, the Compensation Committee uses Exxon Mobil, Royal Dutch Shell, BP and Chevron for benchmarking purposes. These choices result in outsize pay for a total shareholder return that underperforms its peers over three and five years.
“Cherry-picking peers to raise target compensation is a major reason CEO pay continues its inexorable rise,” added McEntee. “Compensation committees need to stop playing these games.”
Vote No on Alcoa MSOP background
ConocoPhillips Vote No MSOP background
