Shareholders have voted to reject the compensation of the CEO and other top executives at 20 U.S. companies in non-binding say-on-pay voting through May 17, according to a report released Tuesday by Georgeson, which provides shareholder consulting services to corporations and shareholder group.
The rejections show the influence of proxy advisory firms Institutional Shareholder Services and Glass Lewis, according to the report. The two firms recommended that shareholders reject the compensation at the same 15 companies, where approval averaged 36% support. ISS urged rejection of say-on-pay ratification at 18 companies total, while Glass Lewis recommended rejection at a total of 15 companies.
ISS and Glass Lewis recommended approval of compensation at only two of the 20 companies, Dynasil Corp. of America and Patriot Scientific Corp. The votes had the highest level of shareholder support among the 20 companies, with Dynasil at 48% and Patriot Scientific at 46%.
“High insider ownership at Biglari Holdings Inc. with 15%, Digital Generation Inc. with 18%, Dynasil with 44% “was not sufficient to avoid a failed vote,” according to the Georgeson report. The companies garnered, respectively, 33%, 39% and 48% of shares in support of their executive pay programs.
Comstock Resources Inc. and Gentiva Health Services Inc. had their executive pay rejected by a majority of shareholders for the second year in a row, the report stated.
Seventeen companies had the majority of their shares held by institutional investors, the report stated. In all of 2012, 59 U.S. companies had failed say-on-pay votes, while in 2011, it was 36.