AFL-CIO to Target Verizon Over Executive Pay
The AFL-CIO, the largest U.S. union federation, is targeting Verizon Communications in a campaign against high executive pay, and will vote against the company's compensation committee at the company's May 3 annual meeting.
Verizon Chief Executive Ivan Seidenberg has earned more than $109 million in the past five years despite a total shareholder return of negative 5%, the AFL-CIO said.
"Working people are fed up with a system that showers CEOs with lavish rewards with little or no accountability," AFL-CIO Secretary-Treasurer Richard Trumka said in a statement.
Verizon spokesman Eric Rabe on Friday defended Seidenberg's compensation.
"We think Ivan Seidenberg is paid quite appropriately and there is no issue regarding his pay compared to other communications executives," he said, adding that the company's stock performed well last year.
"We're not quite sure why they have an issue with this," Rabe said. Seidenberg actually received less than half the figure cited by the union, since many of his options have not vested and may never vest, he said.
"Most of his pay is at risk," Rabe said.
Verizon is scheduled to hold its annual shareholder meeting on May 3 in Pittsburgh, Pennsylvania. Its shares are up about 13% over the past 52 weeks, closing at $38 in Thursday New York Stock Exchange trade.
The AFL-CIO is supporting propositions that would allow a shareholder vote on executives' departure pay, give shareholders a non-binding advisory vote on executive pay, and improve independence of company compensation consultants, said Dan Pedrotty, director of its office of investment, whose union-sponsored funds have $400 billion in assets.
The AFL-CIO said its push against Verizon follows a "successful intervention" at Pfizer and Home Depot.
Critics of CEO pay have focused on a $198 million package given to former Pfizer CEO Hank McKinnell, and a $210 million pay package awarded to former Home Depot CEO Robert Nardelli.