While citing concerns about the lack of disclosures and discretion used to award pay, investors were recommended by the top proxy adviser Institutional Shareholder Services (ISS) to cast proxy votes against the salary of Wells Fargo & Co (WFC.N) Chief Executive Charles Scharf and other leaders on April 12.
ISS also supported a call for a report on racial equity at the big California-based bank and recommended votes “against” a shareholder proposal that would sharply reduce lending for fossil fuel projects, and supported all company director nominees, according to a report provided by a representative.
Wells Fargo’s proxy statement confirmed that $21.4 million was given to CEO Scharf as compensation in 2021, up from $20.4 million in 2021. The 2021 compensation was last year backed only by a narrow majority of investor ballots, 57%, in an advisory vote, part of a wave of critical investor feedback on the topic.
In response, Wells Fargo spoke with shareholders, and they said that more of Scharf’s pay should be tied to performance and that they wanted things like more detail about how it determined compensation.
According to its report, ISS said that the changes made by the bank at the time still left concerns, including:
“Those financial accomplishments the bank emphasized for setting 2021 pay are not entirely consistent with those highlighted in the prior year without specific rationale provided.”
Furthermore, the base salaries of executives are relatively high including that of Scharf, who received a salary of $2.5 million, ISS said.
Wells Fargo representatives did not offer any comment immediately.