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Supervalue Shareholders OK 'Say on Pay': The Shareholder-Sponsored Move at Supervalu's Annual Meeting Would Give Shareholders a Vote on Executive Pay If the Board Adopts It.
Friday, June 26, 2009 6:12 AM


(Source: Star Tribune, Minneapolis)trackingBy Matt McKinney, Star Tribune, Minneapolis

Jun. 26--Supervalu shareholders Thursday acted against the advice of the company's board and approved a proposal that grants them a vote on executive pay, a move championed by a shareholder who said Supervalu's top management is paid too much.

The nonbinding "say on pay" measure, offered by activist shareholder Gerald Armstrong of Denver, would make the Eden Prairie-based Supervalu one of a handful of publicly traded companies nationwide to allow shareholders an up-or-down vote on executive pay and perks. The board must adopt the measure before it goes into effect.

Armstrong said the growth of executive pay at Supervalu far outpaces that of rank-and-file workers.

"The people who ring up the groceries and stock up the shelves and handle the distribution systems: They are certainly the ones that people are concerned about," he said in an interview.

Supervalu executives were not available for comment Thursday because of pending earnings announcements, according to a spokeswoman. But in its proxy statement, the company said the say on pay measure was unnecessary and potentially harmful if it put Supervalu at a competitive disadvantage.

The company's compensation committee did not award some cash incentives in the most recent fiscal year, the statement continued, because corporate goals were not met. Top executives also saw their 2009 salary frozen at 2008 levels, the company statement said.

A spokeswoman for the Council of Institutional Investors, a nonprofit based in Washington, D.C., said hundreds of say on pay proposals have come before shareholders this year, but only a few have passed. Still, the measures have won fans in recent months amid the wreckage of high profile financial companies like Merrill Lynch and Wachovia. Federal legislation requires companies to adopt such measures if they take bailout money under the government's Troubled Assets Relief Program.

Armstrong's proposal on executive compensation zeroed in on the past five years of growth in the compensation of CEO Jeff Noddle and executives Michael Jackson and Pamela Knous, who saw pay and perks at least double and, in the case of Noddle, quadruple. The period covers Supervalu's 2006 acquisition of Albertsons, which dramatically reshaped the company.

Armstrong also listed the compensation of newer hires Duncan MacNaughton and Kevin Tripp, who were brought in after the acquisition.




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