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By Staff Report
May. 3, 2005
As activist shareholders gather at corporate annual meetings this spring, the AFL-CIO is naming six companies whose compensation programs promote CEO “pay greed.” They are: Amgen, Sempra Energy, Coca-Cola, Dynegy, Sprint and Wal-Mart.
In an ongoing effort to reform “runaway” executive pay, the labor organization says it has selected the firms to highlight issues such as excessive compensation and golden parachutes for fired corporate leaders.
Union-sponsored retirement funds introduced shareholder proposals this year for the six companies. The reforms include restricting a CEO’s ability to cash out his equity awards, a requirement for shareholder approval for preferential executive pensions and the creation of performance benchmarks that must be met before restricted stock could vest.
The reforms are necessary because “excessive CEO pay takes money out of the pockets of shareholders, including the retirement savings of America’s working families,” the AFL-CIO contends.
“Investors are concerned not just about the growing size of executive compensation packages, but the fact that CEO pay levels show little apparent relationship to corporate profits, stock prices or executive performance,” the AFL-CIO says.
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