More than 3 million stockholders were given the option to cast an advisory vote, which took place at the company's annual shareholders' meeting on Nov. 19 in Bellevue, Washington.В Overall, 85 percent of shares were entitled to vote.
Announced in September, Microsoft shareholders will have a "say on pay" every three years. Microsoft officials said in a statement that a triennial model best matches its executive compensation program, which aims to link executive compensation to company performance. As part of the policy, the votes are non-binding and could be overruled by the Board.
Microsoft General Counsel Brad Smith told the Wall Street Journal that the policy would promote dialogue with shareholders. According to a Microsoft blog, Redmond reportedly discussed "say-on-pay" options after receiving shareholder proposals from Walden Asset Management and Calvert Investments, and from the United Brotherhood of Carpenters.
Microsoft's vote comes during a time of increased government and media focus on executive pay, as well as proposed legislation to require greater disclosure and stockholder involvement. There are at least three pieces of legislation in the Senate that include pay disclosure measures.
While the legislative discussion initially focused on companies that had received financial recovery assistance from the Troubled Assets Relief Program (TARP) fund, the scope widened in June 2009 when Treasury Secretary Timothy Geithner announced that the Administration would authorize the SEC authority to implement "say-on-pay" regulations at all companies (contingent on Congressional approval).
More than two dozen companies have already adopted the plan, including Verizon Communications Inc. and Apple Inc. The Journa l also reports that more than half of the companies in the Fortune 100 included the initiative in their most recent proxy statement, as of September 2009.
About government policy, Microsoft not surprisingly advocates that companies be given the flexibility in determining specifics of "say-on-pay" policies.
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