ISS Says Wells Fargo Wage Reforms Insufficient to Warrant Support | Investment News
(Reuters) – Top proxy advisor Institutional Shareholder Services on Tuesday recommended investors vote proxies against the pay of Wells Fargo & Co chief executive Charles Scharf and other executives, citing concerns about the discretion used to assign salary and lack of disclosure.
In a report provided by a representative, ISS also backed a call for a report on racial equity at the big California bank, but backed all of the company’s leadership candidates and recommended voting “against” a shareholder proposal that would significantly reduce lending to fossil fuel projects. .
CEO Scharf received total compensation of $21.4 million in 2021, compared to $20.4 million in 2020, according to Wells Fargo’s proxy statement. Last year, only a slim majority of investor votes, 57%, backed 2020 compensation in an advisory vote, amid a flurry of critical investor commentary on the subject.
Wells Fargo spoke to shareholders in response and said they wanted things like more details on how it determines compensation and for more of Scharf’s pay to be tied to performance.
But ISS said changes made by the bank at the time still left concerns, such as the financial achievements the bank highlighted in setting the 2021 salary “are not entirely consistent with those highlighted the year prior without specific rationale provided,” according to its report.
Additionally, ISS said executive base salaries were relatively high, including that of Scharf, who received a salary of $2.5 million.
Wells Fargo representatives did not immediately comment.
(Reporting by Ross Kerber; Editing by Tom Hogue and Lincoln Feast.)
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