Institutional Investors Press Verizon to Implement 'Say on Pay'

Seven major institutional investors that hold more that $790 million in Verizon Communications stock pressed Verizon to implement the shareholder proposal on executive compensation that received a majority vote at the 2007 annual meeting.

The "Say on Pay" proposal called on Verizon to allow shareholders to vote for or against the compensation of its top executive officers at each annual meeting. The vote would be non-binding but would give shareholders a voice on executive compensation and encourage meaningful conversations between the Board of Directors and institutional investors. 

"A majority of Verizon shareholders has spoken and has demanded a voice in setting executive compensation at Verizon," said CWA Executive Vice President Jeff Rechenbach. "CWA urges Verizon to implement this proposal to demonstrate good corporate governance."

Verizon has said publicly that it is continuing to evaluate the proposal.

Shareholders in the United Kingdom, Australia, the Netherlands, and Sweden already have the ability to weigh in on executive compensation in a non-binding vote. The evidence from the U.K., in particular, is that "Say on Pay" appears to moderate pay increases, enhances the ability of compensation committees to stand up to insider pressure, and adds legitimacy to the executive compensation process.

For more information on corporate governance issues at Verizon, go to http://investor.cwa-union.org/verizon.