Say on Pay – Much Ado About Nothing?


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Expert Perspective from Grahall’s Michael Dennis Graham

This is another case of regulations for everyone based on the mischief of a few.  And as we have seen these efforts rarely have the intended outcomes.  From our point of view say on pay will impact companies little if at all.

1) Companies and boards whose compensation practices are egregious, will likely continue this way since the Boards and the CEO’s are entrenched in the organizations, don’t care about the outcomes of advisory votes on pay and will take no action since the vote is, after all, non-binding.

2) For companies and boards that are doing a good job with compensation structures and practices (probably close to 90% of publicly listed organizations), the outcome of a non-binding vote will simply validate their actions.

“Say on pay” is a catchy phrase particularly if you are looking to grand stand as a populist senator, following in the footsteps of a past attorney general who became governor and was headed for the white house but ended up in the dog house. 

And speaking of dogs, it reminds me of a famous adage coined in rural America (where common sense is not in as short a supply):  “That dog don’t hunt”. To carry the dog analogy a bit further, as Will Rogers said: “I love a dog. He does nothing for political reasons.” I wonder can the same be said for Sen. Schumer’s efforts around Say on Pay?

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