Our previous research shows that CEO pay plans may have been misaligned with long-term shareholder returns. The Council of Institutional Investors now is focusing on this topic.
Over the past several proxy seasons, institutional investor sentiment on executive pay has become more negative, particularly among select large European asset owners and some of the most influential U.S. pension plans.
While not all large asset owners agree, there appears to be an increasing focus on pay plan simplicity and transparency, and on the need for better alignment between CEO pay incentives and the creation of sustainable, long-term value.
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