NEW YORK (TheStreet) - Although I've been an outspoken proponent for strong corporate governance and am genuinely sorry about the state of it today in Corporate America, I'm not always in agreement with what some argue is in the best interests of shareholders.
A case in point is push by some for more "Say-On-Pay" votes at shareholders'meetings. Large institutional shareholders and pension funds carp on the fact that CEO and executive pay continue to climb in this country. Often, CEOs get paid even when their companies are chronic under-performers of the market. We often hear about how much more than the "average" worker CEOs are getting today versus the 1960s.
And, look, I'm against over-paying fat-cat CEOs who add no value as much as the next guy. Heck, that's partly why I launched my campaign against Terry Semel atYahoo!(YHOO_)in 2007 to remove him. He ended up pulling out more than $600 million from that company for his 6 years of work there. Most would say he got way more than he deserved.
Yet, these say-on-pay votes are always non-binding. Shareholders keep putting them on the proxies to be voted on whether to include them or not. Sometimes they pass. Sometimes they don't. Even when they do pass and then -- a year later -- get voted on in a disapproving manner, not much has changed.
In my view, shareholders can already show their displeasure with high executive compensation: vote "no" against the re-election of the directors who served on the compensation committee or -- if you don't feel that's sufficient -- against all the directors.
I was irate that Terry Semel got paid that amount of money but, at the end of the day, if I were in hisshoesand Yahoo!'s board offered me that kind of sweet deal, I couldn't say I wouldn't have accepted the same package. It wasn't an inanimate object known as Yahoo! who offered the deal to Semel, it was the members of the board.
I also recently objected to some overly-zealous corporate governance advocates who banged the drum forApple(AAPL_)to reveal its succession plan for Steve Jobs. They stirred up this belief that the board was holding something back. The media also ran with this.
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