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Geithner on credit plan, executive pay Feb. 4: During an appearance with President Obama, Treasury Secretary Geithner announces a plan to get credit flowing again, and limit executive pay for firms taking taxpayer money. MSNBC |
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McCaskill on capping 'corporate greed' Feb. 3: Sen. Claire McCaskill, D-Mo., wants to cap salaries of banking executives at $400,000 if they accept bailout money. McCaskill explains how this will help stop corporate greed. Hardball |
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Black workers' crisis may linger after upturn The recession has compounded a decades-long problem facing black workers, leaving experts worried blacks will remain in crisis even in a recovery. |
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WASHINGTON - The country's largest corporations have turned to a group of seasoned lobbyists to fend off strict new limits on corporate honchos' pay.
The group, called the Center on Executive Compensation, also has the formidable task of persuading a recession-weary public enraged at corporate America that gold-plated compensation deals can be reasonable.
"If you're not telling your story on pay, someone's going to tell it for you," Charles G. Tharp, who is in charge of policy at the Center, said in a recent interview.
That's what President Barack Obama did last week when he angrily branded as "shameful" a report that Wall Street firms handed out more than $18 billion in bonuses last year. Sen. Claire McCaskill, D-Mo., followed up by calling financial executives "idiots."
Now Obama, who on Wednesday announced new executive compensation curbs for companies benefiting from the financial bailout, is promising "broader reforms." On Capitol Hill, Sen. John Kerry, D-Mass., is trying to scale back tax benefits for executive pay packages for all companies.
It's that kind of talk that has the Center, funded by 55 large corporations mostly outside the financial sector, ratcheting up its efforts.
"We wanted to ensure that policy changes made for a certain sector getting government assistance (weren't) generalized across the board," said Timothy J. Bartl, the lead lobbyist for the group. "We understand the need for strings when federal government money is being applied. The question is how far do you go before you affect those who aren't getting the help?"
Bartl has been making the rounds on Capitol Hill, at the Securities and Exchange Commission and with Obama's team as he pushes the Center's argument that past attempts to regulate corporate magnates' compensation have backfired, and that the matter is best left to corporate boards and compensation committees — not the government or even a vote of the company's shareholders.
And just as importantly, the group is working to burnish the images of big companies in the face of a steady stream of bad press and eye-popping compensation figures.
"Just to pick a number out, while it's easy and it makes a good headline, it doesn't really tell the whole story," Tharp says. "We have to do a better job of explaining what good pay linked to performance is and looks like."
While the group won't disclose its members, its advisory board offers a glimpse. It includes executives of the clothing retailer Gap Inc., International Paper Co., the aerospace giant Lockheed Martin Corp. home products seller Lowe's Cos. and McDonald's Corp.
The chief executives of most of the companies represented on the board had compensation valued at $10 million or more in 2007, the latest year for which Associated Press calculations are available, and some had packages — including salary, bonus, incentives, perks, above-market returns on deferred compensation, and the estimated value of stock options and awards — worth two or three times that.
Shareholder activists criticize the lobbying efforts. Nell Minow of The Corporate Library, an independent corporate governance research company, said big businesses should have stepped up years ago to inject some restraint into their compensation plans rather than mounting a major campaign now to ensure they're not painted with the same brush as the financial sector.
"Instead of actually solving the problem, they're trying to throw money at lobbyists to convince people that it's not a problem at all," Minow said.
The Center, which publishes issue papers, surveys and reports to back up its arguments, is an offshoot of the HR Policy Association, a group of 250 Fortune 500 companies that spent about $2 million lobbying Congress last year on various issues.
Bartl, a former Republican congressional aide, is one of five lobbyists representing the association — all part of a firm run by former Capitol Hill staffers with expertise on labor and employment issues. Tharp previously worked as a human resources executive at companies that include Bristol-Myers Squibb Co. and Saks Inc.
"I feel very sorry for them," Minow said of the corporate lobbyists. "There isn't enough money in the world to get me to try to make that case right now."
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