Sisters confront Goldman Sachs over executive pay

by Tom Gallagher

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From the UK's Guardian newspaper:

The Sisters of Saint Joseph of Boston, Sisters of Notre Dame de Namur, the Sisters of St Francis of Philadelphia and the Benedictine Sisters of Mt Angel – all investors in the bank – have put their name to a proposal to review its remuneration policies, after it emerged its five most senior employees were collectively awarded $69.5m in pay last year.

The securities and exchange commission disclosed the challenge in a filing ahead of Goldman Sachs' annual meeting next month.

The nuns asked that "shareholders request that the board's compensation committee initiate a review of our company's senior executive compensation policies and make available a summary report of that review by 1 October, 2011 (omitting confidential information and processed at a reasonable cost). We request that the report include:

  1. An evaluation of whether our senior executive compensation packages (including, but not limited to, options, benefits, perks, loans and retirement agreements) are 'excessive' and should be modified.

  2. An exploration of how sizeable layoffs and the level of pay of our lowest paid workers impact senior executive pay.

  3. An analysis of the way in which fluctuations in revenues impact: a) the company's compensation pool; b) the compensation of the company's top 25 senior executives; and c) the company's shareholders."

The nuns have made their feelings on Goldman's pay levels clear in previous years, with about as much success as the coalition government in its attempts to limit UK bank bonuses. Chief executive Lloyd Blankfein, who has claimed to be doing "God's work" at Goldman, saw his pay reach $14m in 2010, with four other senior executives receiving a similar amount.

Goldman said it would resist the request.

Editor's Note: In the interest of disclosure, NCR contributor Tom Gallagher worked as an employee at Goldman Sachs for four and a half years.

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