Yahoo CEO, Board of Directors to Face Unhappy Shareholders
Yahoo’s flagging morale–and marketshare–may lead to a lower paycheck for Yahoo CEO Terry Semel. Semel is still being compensated $71.7M (last year) three years after vowing not to lose their market dominance to Google. That amount, according to the AP, is “more than any other CEO at the 386 publicly held companies covered in an Associated Press analysis of nation’s top corporate paychecks.”
But wait, you say. I know what Terry Semel made last year. And Sergey and Larry, too. They only made $1. Only not. Semel’s stock options (like everyone else’s that’s done this) still brought him $71.7M.
Semel’s not the only member of the board facing the chopping block today. The same group of shareholders unhappy with Semel’s leadership is also targeting Roy Bostock, Ron Burkle, Eric Hippeau, Arthur Kern, Robert Kotick, Edward Kozel and Gary Wilson. (Then the AP says, “Only Yahoo co-founder Jerry Yang, Hewlett-Packard Co. printing executive Vyomesh Joshi and Ed Kozel, CEO of Silicon Valley startup Skyrider Inc., have done enough to remain on the board, Jackson contends.” . . . Kozel made both lists. He gets around?)
Although this group of shareholders is small (2 million shares or <0.2%), there’s a chance they might be able to effect the vote. If they can prevent a majority sustaining vote (i.e., more than 50% of of shareholders voting to keep each director), the directors are supposed to be automatically removed. (This is a change from their previous system of “plurality,” where, as long as no one contested their chair, any supporting vote was enough to keep their jobs.) Of course, as the AP notes, the board of directors can still decline to accept their resignations, even if a majority of the shareholders disagree.
Will Semel survive? Most likely. Will he continue to receive 800,000-share bonuses in the future? Perhaps not. Apparently, his latest 800k share bonus, awarded for last year’s performance and now part of his nearly 25 million Yahoo share portfolio (more than 2/3s of which are vested), is actually one of the reasons why shareholders are upset with the other members of the board.
If nothing else, it may make them think twice about bonuses for a year with 35% drop in stock price.
via, ironically,Yahoo Finance.