BOSTON, MA – Boston Common Asset Management commended Aflac Incorporated today following management’s announcement that it will implement an advisory vote on executive compensation in its 2009 proxy.
Aflac’s decision to adopt this important corporate governance policy evolved from an open and constructive dialogue with Boston Common and other stakeholders who petitioned for this change. “During the course of the dialogue, the group reviewed the metrics behind Aflac’s executive compensation practices and was impressed with the company’s pay-for-performance philosophy and record,” said Dawn Wolfe, social research and advocacy analyst at Boston Common.
“As long-term shareholders of Aflac Incorporated, Boston Common is pleased that management is taking a leadership role in the area of corporate governance by giving shareholders the opportunity to provide feedback on executive compensation packages,” said Wolfe. “The groundbreaking decision Aflac has made to implement an advisory vote on executive compensation demonstrates a commitment to good governance and a willingness to listen to shareholders. Boston Common commends the Board of Directors for taking this important step and setting an example for other U.S. companies considering adoption of an advisory vote.”
With today’s announcement, Aflac became the first U.S. company to agree to implement an advisory vote on executive compensation.
A diverse network of shareholders called on over 40 companies in 2007 to adopt a non-binding advisory vote on executive compensation. Shareholder votes on executive compensation are currently required in the U.K., Australia, and the Netherlands, and in 2006 Swedish companies began using advisory votes on executive compensation. A growing number of investors believe that advisory shareholder votes on executive compensation encourage pay for performance practices and increase communication between shareholders and directors on executive compensation. ”
