华信惠悦-公司治理与高管薪酬

…InstitutionalInvestorActivismNYSE&NASDAQListingRequirementsStockOptionAccountingNewU.S.GovernanceLegislationLossofInvestorConfidenceUncertainEconomyExecutiveCompensation3SomeoftheGovernanceConcernsthathavebeenExpressed:ExecutivePay:–Notlinkedtoperformance–Escalatingratioofexecutivecompensationtothepayofothermanagers,workers–WhatisaCEOworth?–ExecutiveloansStockOptions:–Absenceofaccountingchargehasfacilitatedexcessuseofoptions–Equivalentcashvalueofastockoptiontoanexecutiveislessthanitseconomiccosttothecompany–Arisingtidefloatsallboats4GovernanceConcerns(Cont’d)IntheBoardroom:–ThecultureofmostBoardroomsmakesiteasiertogoalongwithManagement’srequeststhantorejectorreducethem–Compensationconsultantsareusuallynotindependentofmanagement–Improperuse/overuseofcompensationsurveyscausea“ratcheting”effectinexecutivecompensation–Manycompensationcommitteeslacktheexperiencenecessarytoanalyzecomplexproposalsandtodevelopinformedopinions,proorcon5Meanwhile,CompanyCEOsalsoHaveConcernsImpactofnewlegislationandstandardsongovernanceandday-to-dayoperationsArticulatingcorporatestrategyinshareholderterms,withmoreBoardinvolvementAchievementoffinancialresultsinanuncertainenvironmentShortenedcareers—produceorelseAttraction,motivationandretentionofkeyexecutivetalentCashcompensationvs.equityincentivesOtherissues:succession,etc.6ShareholderObjectivesforExecutiveCompensationBuildreallong-termgrowthinshareholdervalueCompetitive,performance-alignedcompensationAvoidcorporatefuturefinancialhardshipasaresultofspecialcompensationarrangementsPricingrelativetothemarket—properuseofcompensationinstrumentsTrulyindependentCompensationCommitteesFull,truthfulandstraightforwarddisclosureof–Theprinciplesandstructuresofexecutivecompensationsystems(i.e.,no“boilerplate”)–Decision-makingprocessforcurrentyearawards7ExamplesofShareholderResistanceCoolBrands:21%dropinstockpricefollowingrequestformoreoptionsCHCHelicopters:“No”to11%optiondilutionproposalATITechnologies:Only54%shareholderapprovalfornewoptionsFairvest/InstitutionalShareholderServices:useoftheISSoptionvaluationmodelleadstomore“No”recommendationsTeachersPensionPlan:optiongrantsshouldbeproportionaltoexecutiveownershipAngiotechPharmaceutical:“evergreen”stockoptionreplenishmentrescindedduetoinstitutionalshareholderconcernsandnegativepress8TheCanadianCoalitionforGoodGovernanceisGainingCloutLaunchedlastyearBrainchildofSteveJarislowskyandClaudeLamoureuxConsistsofCanada’slargestpensionfunds,mutualfundsandmoneymanagersPurposeistoshareinformationandtaketheinitiativetoholdmanagementaccountableforgrowinglong-termshareholdervalueTheCoalitionwillsupportcompensationschemesthatrewardemployeesforsustainedperformancesSuccessfullyattackedAngiotechproposal9NewLegislationandStandardsareAffectingExecutiveCompensationU.S.Sarbanes-OxleyActProposedChangestoNYSEandNASDAQListingRulesCanadianSecuritiesAdministrators’DisclosureConcernsInternationalStockOptionExpensingProposalsRepapCourtCase10ShareholderDisclosureConcernsCanadianSecuritiesAdministratorsNov.5,2002pressrelease:–Sampleof76publicly-tradedcompanies–95%had“inadequate”disclosureWatsonWyattProxyCircularReview–272TSXcompaniesin2002–48%hadnodisclosureannualincentivedetermination11StockOptionAccountingStandardsStockoptionexpensingisjustaroundthecorner!InternationalBoardisgoingtomandateinternationalstockoptionexpensingstandardsthisyearCanadianBoardhasannouncedintentiontorequirestockoptionexpensingbeforetheU.S.actsU.S.AccountingBoardisconsideringmandatoryadoptionManylargeNorthAmericancorporations(over150)havealreadydecidedtoexpenseoptions:•Boeing(first)•Coca-Cola•CanadianBanks•Amazon.com•Ford•GE•Inco•GM•Wal-Mart•SunLife•BCE12MeetingShareholderConcernswithOptions:ProsandConsIndexedoptionsPremium-priceoptionsPerformance-vestedoptionsGreaterstockownershipRestrictedstockunitsCashlongtermincentiveplans13MeanwhileintheCourts:TheRepapCaseNewChairmanwasaretiredU.S.lawyer;noexperienceinRepap’sindustrySummaryofhiscontract:–Amulti-milliondollar“marketcapitalizationbonus”notlinkedtofinancialperformance–Sharesandoptionsamountingto13.4%ofthecompany’sstock–Immediatepensioncreditsof8years–A“singletrigger”change-of-controlseverancepackageworthabout$27millionOntarioTrialCourtJudgesetasideChairman’scompensationagreementbecausethedirectorshadnotspentsufficienttimeanalyzinganddiscussingthecontractIndoingso,shesetasidethe“businessjudgmentrule”thatnormallyprotectsdirectorsfrombeingsecondguessed14YES,Executivepayisunderthemicroscope,BUT...CanadianandU.S.WatsonWyattstudies*showthat:–HigherCEOcompensationopportunityiscorrelatedwithhigherTotalShareholderReturns(TSR)–HigherCEOandExecutivestockownershipiscorrelatedwithhigherTSR,EPS,ROE,ROA–Higherstockoptionopportunityisalsopositivelycorrelatedwithh