Pension funds holding Oracle Corp. (ORCL) shares issued a letter opposing the re-election of directors because they said the board had failed to change the compensation structure, adding to the dissenting voices on executive pay before the company’s annual meeting.
The California State Teachers’ Retirement System, the U.K.’s Railway Pension Investments Ltd. and Dutch pension-fund manager PGGM NV sent a letter to Oracle shareholders on Oct. 28 saying they have “severe concerns about executive compensation and proper board accountability at Oracle” and opposing the re-election of the company’s 11 directors.
Shareholders will gather today for an annual meeting at Oracle’s Redwood City, California, headquarters to vote on executive pay, director election and other matters. Institutional Shareholder Services, which advises investors in proxy voting matters, on Oct. 15 recommended shareholders vote against the pay plan for Chief Executive Officer Larry Ellison and other executives, and withhold votes from Chairman Jeff Henley and seven independent board members, including Bruce Chizen, George Conrades and Naomi Seligman of the compensation committee.
ISS and dissident investors have said Oracle, the world’s largest database-software maker, isn’t aligning pay with performance. Sales this year are projected to increase 3 percent, according to data compiled by Bloomberg. Oracle’s stock has gained 8.2 percent in the past year, compared with a 25 percent gain in the Standard & Poor’s 500 Index.
Oracle has also tussled with labor group Change to Win, which has criticized compensation for top managers. The California Public Employees’ Retirement System also said it’s voting against Oracle’s pay plan and compensation committee chairman Chizen.
The shares of Oracle fell less than 1 percent to $33.53 at yesterday’s close in New York.
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