Frontier Stockholders Voice Strong Support for ‘Say on Pay’

Contact: Tony Daley, CWA, tdaley@cwa-union.org, 202-434-9515

Stamford, Conn. – At the 2009 annual stockholder meeting of Frontier Communications today, stockholders voiced strong support for a proposed "Say on Pay" measure on executive compensation sponsored by a member of the Communications Workers of America. The proposal received 48.6 percent of the vote, according to preliminary results, while the "no" vote (recommended by the Board of Directors) was 49.3 percent and abstentions totaled 2.1 percent. Frontier management failed to get a majority for its position.

CWA pointed out that "Say on Pay" resolutions call for a nonbinding advisory vote that enables shareholders to express their approval or disapproval of how a company pays its top executives. Executive pay has become a controversial issue especially during the current economic crisis, with the government's allocation of taxpayer money to bail out struggling financial institutions intensifying public scrutiny of executive bonuses and compensation packages at all U.S. corporations, the union said.

The full text of the proposal may be found here at http://investor.cwa-union.org/frontier/

This is the second year that "say on pay" has been on the ballot at Frontier. In 2008, the proposals received 44.5 percent of the vote while 51.2 percent voted against, and 4.3 percent abstained.

Frontier Chief Executive Officer and Board Chairman Maggie Wilderotter saw her total compensation increase by 74 percent in 2008. That was in addition to a 33 percent increase in 2007. Meanwhile, total shareholder return fell by 24 percent in 2008 after having dropped by 5 percent in 2007.

CWA Vice President Jimmy Gurganus said "the increase from last year shows that stockholders are becoming even more frustrated with the compensation practices of Frontier's Board. There truly is a disconnect between executive compensation and shareholder value at Frontier. This is not pay for performance. This Board simply does not get it." 

While the measure did not receive a majority, and the company is not required to adopt the shareholder proposal, Gurganus called on the Board to give serious consideration to adopting the measure. "The failure to obtain a majority suggests serious doubt as to whether the Board reflects the interests of Frontier stockholders," he said.