Executives may have to swallow limits on compensation from Congress or investors
By Staff Writer|March 01, 2007 at 07:00 PM
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U.S. Rep. Barney Frank (D-Mass.), the new chairman of the House Financial Services Committee, is always looking for allies for his campaign to rein in executive compensation. But, no doubt, even he was surprised when President George W. Bush turned up on the same side of the fence. In recent weeks, the president has taken several opportunities, including on a late January visit to Wall Street, to criticize excessive executive pay. The nation’s chief executive called on shareholders to take a hard look at executive compensation packages. “[Executive compensation] is one [issue] where politicians on both sides of the aisle see opportunity,” says Patrick McGurn, executive vice president and special counsel at Institutional Shareholder Services (ISS). He notes that Bush’s message about shareholders being empowered to challenge management is identical to Frank’s. He adds: “They’re basically saying the same thing–it’s just that one is suggesting a governmental approach and the other is stressing the private sector.”
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