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First-ever sharehoder votes on 'say-for-pay' at Canada's big banks get strong support
Vancouver (10 March 2007) – Shareholders of Canadian public companies had their first opportunity to gain a “say on pay” at the annual general meetings of four of Canada’s ‘big five’ banks. The votes, held over the last two weeks, ranged from a high of 45% of CIBC shareholders to a low of 39% of Scotia Bank shareholders. The vote was in support of adopting an annual non-binding advisory vote on executive compensation. A identical proposal will also be presented and voted on at upcoming annual meeting of the remaining ‘big-five’ bank, the Toronto-Dominion Bank on April 3.
The proposal, brought forward by Meritas Mutual Funds with support from Shareholders Association for Research and Education (SHARE), is the first of its kind in Canada.
Gary Hawton, Meritas CEO, was emboldened by the results, explaining “These results are incredibly strong given that first time proposals typically receive about 7% of the vote. To have so many investors join with us in support of this proposal will send a strong message to publicly traded companies in Canada as well as to securities regulators.”
It remains uncertain whether the banks will choose to incorporate the non-binding vote. Having an advisory vote would not affect actual compensation paid to executives, but rather is intended to let shareholders clearly express their views of executive compensation.