In the end, a lot of talk and not much action.
"The bottom line, they still went home to their mansions," said Steven Balsam, an accounting professor at Temple University and author of Executive Compensation: An Introduction to Practice & Theory.
Investors seem to have a fairly high tolerance for generous CEO pay. It's been rising for decades, after all, and doesn't seem likely to stop.
For the 100 largest Philadelphia-area companies, median CEO pay increased 10.9 percent in 2007, according to data newly compiled for The Inquirer by Equilar Inc., an executive-compensation research firm. Among the same companies, median annual revenue increased 2.7 percent. Chief executives at Philadelphia's largest companies fared better than their counterparts nationally. Median S&P 500 CEO pay increased 1.3 percent, according to Equilar.
"I don't think investors have an issue with higher pay, if performance is there," said Irv Becker, national practice leader for executive compensation at the Hay Group Inc., a Philadelphia-based management consultancy.
Still, concern that compensation committees may be overzealous and susceptible to influence from executives led the Securities and Exchange Commission to establish new disclosure rules in 2006 requiring committees to explain their objectives "in plain English," lay out the criteria by which top executives earn bonuses, and produce a simple table showing each top executive's total compensation and its components.
"Disclosures have forced compensation committees to step back and really look at their programs, and make sure they can rationalize and explain their programs," Becker said.
So is better disclosure making a difference in pay?
