Oracle Investors Reject CEO Ellison’s Pay at Annual Meeting
Oracle Corp. shareholders rejected the pay packages of Chief Executive Officer Larry Ellison and other executives, hewing to the recommendation by a proxy adviser that said their compensation is out of sync with the company’s performance.
At Oracle’s annual meeting today in Redwood City, California, the company said shareholders also voted to re-elect all of its directors, contrary to the guidance of Institutional Shareholder Services. ISS had said votes should be withheld from Chairman Jeff Henley and seven independent board members, including Bruce Chizen, George Conrades and Naomi Seligman of the compensation committee.
Oracle also has tussled with labor group Change to Win, which criticized pay for top managers at the largest database-software maker. On Oct. 28, 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, saying they have “severe concerns about executive compensation and proper board accountability at Oracle.”
The California Public Employees’ Retirement System also said it was voting against Oracle’s pay plan and Chizen, chairman of the board’s compensation committee. It’s the second straight year shareholders have rejected executive pay packages, and the vote is non-binding.
“We’re constantly evaluating information and we will continue to do so,” Michael Boskin, an Oracle director, said at the meeting. “But we think we have a good process that is good corporate governance.”
Oracle, which supplies databases, business applications and computer servers, has seen sales growth slow as companies move to newer programs delivered over the Internet. Revenue this year is projected to rise 3 percent, according to data compiled by Bloomberg. (ORCL) Oracle’s stock had increased 7.9 percent in the past year through yesterday, compared with a 25 percent gain in the Standard & Poor’s 500 Index.
Ellison, 69, is worth $38.7 billion and ranks eighth on the Bloomberg Billionaires Index. He was the highest-paid CEO in the U.S. this year, data compiled by Bloomberg show. His pay package declined 18 percent to $78.4 million for fiscal 2013 after he gave up an annual bonus and the company missed some of its profit targets. Last month, Oracle gave a weaker-than-projected profit forecast for the current quarter.
CtW wants Oracle to appoint a new director to oversee pay, and opposes the use of stock options to pay Ellison and other executives. Ellison owned 24.4 percent of Oracle shares as of Oct. 3, making a vote against directors and the pay plan more challenging.
Deborah Hellinger, a spokeswoman at Oracle, declined to comment on investors’ statements about the company’s proxy election.
Oracle shares rose less than 1 percent to $33.79 at 2:34 p.m. in New York.
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