Earlier this year the Canadian Coalition for Good Governance (an organisation representing the interests of institutional investors) published for comment its draft executive compensation principles. The CCGG did not, at the time, support the adoption of a mandatory "say on pay" vote. Several days ago, the CCGG published a statement on shareholder engagement and "say on pay" in which it further clarified its position in this area:CCGG regards “Say on Pay” shareholder advisory resolutions as an important part of this ongoing integrated engagement process between shareholders and boards, giving shareholders an opportunity to express directly to the board their satisfaction with the prior year’s compensation plan and actual awards. CCGG recommends that boards voluntarily add to each annual meeting agenda an advisory shareholder resolution on the report of their human resources or similar committee, their compensation plan and the prior year’s awards.
The CCGG states that it will soon be publishing a model form of board "say on pay" policy and shareholder resolution.
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