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Winnipeg Free Press - PRINT EDITION
CIBC's turn to hear anger over execs' pay and perks
CIBC has become the second large Canadian bank in a month to face shareholder frustration over the level of compensation paid to senior executives.
Shareholder rights group Medac and a vocal critic of Canadian banks both unsuccessfully urged shareholders at the annual meeting Thursday to approve motions to change the way compensation is doled out.
Louis Gagnon of the Quebec-based Mouvement d'éducation et de défense des actionnaires proposed three motions about stock options and performance-based compensation.
He said stock options are awarded even though a study of Canada's five big banks found their stock price was mainly the result of low interest rates and a favourable economic environment.
"So it is therefore far from appropriate to link the exercise of stock options to stock-price fluctuations," he said in the meeting webcast from Halifax.
He suggested the options only be exercisable after a waiting period if "measurable and quantifiable objectives" such as growth in income per share and return on shareholders' equity are achieved.
Variable compensation accounts for the largest part of a senior executives' total remuneration. To ensure that compensation is justified, Gagnon wanted the bank to compare itself with peers on both compensation of the top five executives along with financial performance.
Earlier this month, shareholders from Medac spent much of National Bank of Canada's three-hour meeting in Montreal criticizing executive compensation.
-- The Canadian Press
Republished from the Winnipeg Free Press print edition April 27, 2012 B16
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