From: Harold Calder
Securities and Exchange Commission
Dear Securities and Exchange Commission,
Almost all top corporate executives are, quite simply, hired hands, that is contract employees. They did not start the company, did not take the risks and pressures of an entrepreneur, although to a large extent they receive the rewards of ownership while only accepting the risks of management. And failure or poor performance is being blessed with a golden parachute.
Hank McKinnel of Pfizer is an example where, during his tenure, the stock price has been nearly halved but his yearly pension for life is $6.5 million. And of course, his pay package has been grossly excessive also. What words can be used to describe this travesty? Can he walk on water as well? Judging from his corporate performance, I do not think he can even swim.
Furthermore, the level of corporate total compensation in this country is out of sight with just as equally smart and good top executives in other countries.
Not only do I want full disclosures of all compensation benefits but I also want a written valuation of all the fringe benefits including expense account costs, travel allowances and all other benefit costs that may amount to more millions a year.
While the benefits of many top executives have been steadily and significantly increased, the increased benefits of the average worker have been puny or even decreased, changed to less attractive benefits, or worse yet, abolished.
The newly proposed rules will make this crucial information more accessible to shareholders and the public. The new requirements to disclose total compensation figures, pensions and detailed compensation breakdowns will make it clear exactly how much top executives are earning and why.
I believe that CEO pay should be set by independent directors.
I also urge the SEC to require that companies disclose pay-for-performance data. In order for investors to understand how pay and performance match up, companies need to explain more clearly what level of performance is necessary for a particular level of pay. I urge the SEC to require companies to disclose both the performance criteria and the performance targets they use when setting executive pay.