[Congressional Record Volume 153, Number 68 (Thursday, April 26, 2007)]
[Extensions of Remarks]
[Pages E862-E863]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




             SHAREHOLDER VOTE ON EXECUTIVE COMPENSATION ACT

                                 ______
                                 

                               speech of

                          HON. BETTY McCOLLUM

                              of minnesota

                    in the house of representatives

                         Friday, April 20, 2007

  Ms. McCOLLUM of Minnesota. Mr. Chairman, I rise today in support of 
the Shareholder Vote on Executive Compensation Act, and I commend 
Chairman Frank for his work on this critical issue.
  While American families struggle to meet their basic needs, such as 
access to affordable housing, health care, and education, the CEOs of 
top companies earn more than 430 times the pay of an average worker. 
The disparity between CEO compensation and minimum wage earnings is 
even more severe. The average CEO earns more before lunch than a 
minimum wage worker earns in a year. This inequality needs to be 
addressed. The Shareholder Vote on Executive Compensation Act is an 
important step toward fairness because it empowers shareholders and 
holds public corporations accountable for their compensation practices.
  H.R. 1257 requires that public companies give shareholders the 
opportunity to have a nonbinding advisory vote on the company's 
executive compensation. It also gives shareholders an additional 
nonbinding vote if the company awards the CEO a new, undisclosed 
personal exit package, also known as a ``golden parachute'' package, 
during negotiations to buy or sell a company. This bill does not in

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any way cap executive salaries nor does it diminish the board's legal 
authority. It simply provides shareholders with a mechanism to voice 
their support or opposition to an executive compensation package.
  This legislation is supported by the International Corporate 
Governance Network, the Council of Institutional Investors, labor 
unions, and shareholder organizations. Further, this approach to 
corporate governance is not new, and it has been shown that it works. 
The nonbinding advisory vote has been successfully implemented in the 
United Kingdom and more recently in Australia. It was also adopted 
voluntarily by the insurance company, Aflac, and 52 other companies 
have similar proposals pending.
  Mr. Chairman, American families cannot afford to continue subsidizing 
excessive CEO compensation packages. I urge my colleagues to join me in 
supporting H.R. 1257.

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