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First-of-a-Kind Study Reveals Nation’s 25 Largest Institutional Investors’ Views
on Executive Compensation
Pay for Performance, Role of the Board and Need for Better Disclosure Are Top Issues
A first-of-its-kind study commissioned by the Center On Executive Compensation (the
Center) to identify the perspectives of the nation’s largest 25 institutional investors
on executive compensation confirms that making broad assumptions about the views
of institutional investors on this topic often does not reflect realities, underscoring
a need for a thoughtful and reasoned approach to any executive compensation policy
changes. Specifically, the study reveals that:
- The majority of large institutional investors do not support a shareholder vote
on executive compensation;
- Large institutional investors are not generally concerned with the level of executive
compensation, provided it is clearly and appropriately linked to company results;
- One-third of the large institutional investors raised unsolicited concerns over
the influence that proxy advisory services have over the proxy voting process, including
compensation matters;
- Despite updated SEC disclosure rules, the overwhelming majority of large institutional
investors have been disappointed in the rules and how companies have implemented
them, especially the lack of clarity in the Compensation Discussion and Analysis.
According to the Center’s report, the study was commissioned because these institutions collectively represent over $6 trillion in U.S. equities, or 65% of the top 300 institutional investors and thus have substantial influence in the marketplace.
Press Release
Summary of Findings and Conclusions
Center On Executive Compensation Action
Items Based on Report
Illustrative Quotes from the Report
Full Study
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