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Activist investor firm decries hefty pay packages for the bank's CFO and ex-CEO.
Stephen Taub, CFO.com | US
April 11, 2008
Citigroup has become perhaps the highest-profile target for activist investors seeking to throw out directors at upcoming annual meetings — and it can partly blame its CFO for the attention.
Proxy-advisory firm Institutional Shareholder Services is calling on shareholders to vote against the reelection of four independent Citi directors, all among the most high-profile executives. According to published reports, they are lead director Alain J.P. Belda, chairman of Alcoa Inc.; former Chevron Corp. chairman Kenneth Derr; Xerox Corp. chairman Anne Mulcahy; and Time Warner chairman Richard Parsons.
The ISS asserts that Citigroup's compensation committee, which is chaired by Parsons and includes Belda and Derr, "has lacked strong stewardship of compensation practices," the Associated Press reported. According to the report, the ISS specifically points to the estimated $9.5 million pay package recently given to CFO Gary Crittenden.
The ISS also singles out the exit package for former CEO Charles Prince, who was booted out in November. He received $40 million from stock awards, a bonus, and other benefits; his 2007 salary of $1 million; and 1.61 million Citi shares he already owned, according to the report.
In addition, the ISS reportedly singles out Mulcahy because she sits on more than three corporate boards — The Washington Post Co., Target Corp., and Xerox — while actively serving as CEO of a corporation.