May 7, 2024

DealBook: Goldman Raises Directors’ Pay by 500 Shares

The power of James Schiro, the lead director of Goldman Sachs, has been increased after an accord with a shareholder.Chester Higgins Jr./The New York TimesThe power of James Schiro, the lead director of Goldman Sachs, has been increased after an accord with a shareholder.

Goldman Sachs directors are getting a pay raise.

Goldman’s directors, who were already among the best-compensated corporate directors in the country, will receive an additional 500 shares, for 3,000 shares a year in compensation, according to a regulatory filing submitted Friday.

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In 2012, the average compensation for a Goldman director was $447,622, according to compensation data provider Equilar. This was down from 2011 when the average compensation was $488,709. Still, some of the firm’s 13 directors made more than $500,000 in 2012 because they led a committee, which pays extra.

Goldman, in the filing, said directors received a raise because of the “increase in demands” placed on directors “particularly considering that during 2012 all them served on each of our board’s standing committees as well as the additional oversight responsibilities required by recent laws and regulations.”

The additional 500 stock units, which have a current value of almost $75,000, are on top of an annual retainer of $75,000 or 532 shares. All told, Goldman’s board met 12 times in 2012.

Goldman has previously defended its pay for directors, saying the bulk of the compensation is in stock that directors cannot touch until after they have left the board. That arrangement, the firm says, aligns directors’ interests with those of shareholders.

The data on director pay was part of a grab bag of information about the company in the filing, which included the pay of Goldman’s chief executive and chairman, Lloyd C. Blankfein, and a list of proposals shareholders will vote at the firm’s annual meeting, which is May 23 in Salt Lake City.

Mr. Blankfein also received a raise. He made $21 million in compensation in 2012, up from $12 million in 2011. Gary D. Cohn, his second in command, made $19 million last year, up from almost $11.9 million in 2011. Investors will vote on four shareholder proposals at the annual meeting. One of the proposals asks the board to “immediately engage the services of an investment banking firm to evaluate alternatives that could enhance shareholder value including, but not limited to, a merger or outright sale of the company, and the shareholders further request that the board take all other steps necessary to actively seek a sale or merger of the company on terms that will maximize share value for shareholders.”

Goldman’s board is recommending shareholders vote against this proposal, saying it will “continue to pursue strategies” that it believes will achieve shareholder value.

What is not in the proxy is also noteworthy.

Earlier this week Goldman said it had reached a deal with the CtW Investment Group, an organization that advises union pension funds, to put the brakes on a vote on a proposal to split the roles of chairman and chief executive.

Under the agreement, Goldman is enhancing the powers of James J. Schiro, the board’s lead director. Mr. Schiro, for instance, will now have to set the agenda for the board, instead of merely approving it.

“We’ve had a constructive engagement with our shareholders, and believe that the enhancements we have made further solidify the independence of the board,” a spokesman for Goldman said in an e-mailed statement.

The question of whether a chief executive should also be chairman has generated discussion among shareholders of big banks. At JPMorgan Chase the board favors the dual role for Jamie Dimon and is working to shore up support among shareholders, who will vote on the issue next month at that bank’s annual meeting.

Article source: http://dealbook.nytimes.com/2013/04/12/goldman-directors-get-a-pay-raise/?partner=rss&emc=rss

You’re the Boss Blog: Lobbying on Behalf of Your Small Business

Few small-business owners — the kind of people who accumulate wealth through a service or manufacturing business and are working at it every day — have the deep pockets of a major corporation. Consider what Amgen, the world’s largest biotechnology company, did to help win an exemption in the so-called fiscal cliff bill to extend its patent on a profitable dialysis drug for two more years at a great cost to Medicare. It sent its 74 lobbyists in Washington to meet with — and direct contributions to — a host of politicians who worked in its favor.

But even if small businesses can’t buy the kind of influence that a huge company like Amgen can, that does not mean they cannot buy influence at all. Still, as in other aspects of life, you get what you pay for.

Entrepreneurs would want to hire a lobbyist for a fairly straightforward reason: they have an issue they want addressed or changed and they have reached the point where they feel they need to act. What is more difficult is acting on that impulse effectively, knowing it could cost a lot of money.

Lawrence E. Scherer, a founder of State and Broadway, a lobbying firm in New York, said a typical retainer for a small-business client would be around $5,000 a month, but the assignment could last for a year or more. Suri Kasirer, once an aide to former Gov. Mario Cuomo of New York and president of Kasirer Consulting, said her typical retainer was $10,000 to $20,000 a month, with a three-month minimum.

“For small-business owners, the idea of having a lobbyist interact with a government is so novel and so out of their scope that $5,000 a month could seem daunting,” Mr. Scherer said. “But as government has more issues in front of it, it could be a cheap date.”

People who have success lobbying state and local governments — since the federal government is beyond the budget of individuals — tend to fall into three categories: they want something changed, they want something new or they want access.

Avik Kabessa, chief executive of Carmel Car and Limousine Service in New York City, said he became part of a group of livery car owners in 2008 that lobbied the state to establish a workers’ compensation fund for livery drivers and to repeal a sales tax on livery fares.

He said it took a year and a half for the lobbying effort to work. The costs were split among members of the group, called the Livery Round Table. (Livery companies fall between higher-end black car and limousine services and city taxis.)

“I wish we had the expertise, knowledge and contacts to have been able to do this ourselves,” he said. “But just as you would go to a doctor when you’re sick, you go to a lobbyist for your legislative affairs.”

Ms. Kasirer is working on a similar case with a group of small-business owners who do not often work well together. She is representing seven expediters — companies that are paid by contractors and developers to get various building permits in New York City. She said new rules could end their business.

“We were approached by a few of them, and we said, ‘Let’s get as many of them together as we could,’ ” she said. “They realized that ultimately they could be put out of business, or their business could be so severely handicapped that they would have to lay off people.”

For small-business owners, forming an ad hoc group and putting aside any competitive business interest to get something greater for their industry is important. So, too, is having the patience and the willingness to accept something short of their goal and then go back for more.

Domenic Rom, a senior vice president at Technicolor, a postproduction company for film and television, became part of a group of similar companies that wanted to lobby for a tax credit. While New York offered tax credits for shooting a film or television show in the state, it did not offer similar credits to the postproduction part of the industry, which includes editing, sound design and adding computer-generated effects.

Mr. Rom said the 14 companies created the Post New York Alliance and each paid $5,000 in dues. They began lobbying in 2009, working with Mr. Scherer. By the next year, they received a 10 percent tax credit for postproduction work.

Article source: http://boss.blogs.nytimes.com/2013/01/25/lobbying-on-behalf-of-your-small-business/?partner=rss&emc=rss