Sheryl Williams, Cephalon vice president of public affairs, stressed that Cephalon exceeded its income target when removing the onetime legal settlement.
"The company's compensation philosophy is pay-for-performance," Williams said.
Disclosures may be a good start, but there is nothing like a proxy battle to force real change. In 2007 at the women's apparel retailer Charming Shoppes Inc., based in Bensalem, the company's stock fell because of lagging 2007 sales. Investment funds such as Myca Partners began buying shares and putting on pressure about company performance.
CEO Dorrit J. Bern's pay dropped 49 percent for 2007, according to Equilar. Then, under further pressure from dissident investors, the company in December reworked Bern's employment contract to eliminate $154,760 of annual perquisites, including a Philadelphia apartment and weekend flights to Chicago. The company tied more of Bern's equity grants to performance, and she survived a proxy battle in May.
At Comcast, growth slowed and shares hurtled down about 36 percent in 2007 - and CEO Brian Roberts' compensation fell 25 percent, as calculated by Equilar. D'Arcy Rudnay, Comcast's senior vice president of corporate communications, said that the top executives at Comcast voluntarily cut their bonuses 20 percent in light of the share drop. She said 68 percent of Roberts' pay is based on financial performance metrics.
Ultimately, disclosure is just a tool for shareholders and regulators concerned about CEO pay. The task now is to use it.
"The objective is to be transparent so shareholders can make a judgment," Hay Group's Becker said. "I think we're laying a foundation for much higher correlation between pay and performance."
