任員報酬制度의 改革 -미국의 株主承認權(Say-on-Pay) 제도를 중심으로-

Abstract

This article explores one of the hotly debated corporate governance issues in U.S., Say-on-Pay. In reaction to the recognition that shareholders in public corporations should exercise a certain form of influence in the area of executive compensation but have limited power to do so, shareholder advisory vote on executive compensation has recently attracted a wide range of public attention, leading some U.S. public corporations to voluntarily adopt a certain form of this policy. Specifically, in the wake of recent financial crisis and global economic crisis, the growing public criticism on the incessant upward trend of executive compensation demands more fundamental remedy to curb compensation problems. Recognizing that there are several systemic flaws in current compensation system, such as lack of linkage between compensation and performance, executive’s short-termism, and lack of director’s accountability to shareholders, shareholder activists as well as many politicians have suggested the adoption of Say-on-Pay policies. In this article, I articulate that Say-on-Pay policies can be characterized as principled examples of shareholder democracy, as well as responsible measures for creating meaningful board accountability. Due to the non-binding effect of Say-on-Pay voting, this policy should be viewed as modest methods for restraining excessive compensation practices. In addition, this policy would facilitate further cooperation between shareholders and boards of directors during the compensation-setting process. Furthermore, by implementing Say-on-Pay, a company would be more appealing to outside investors because it would demonstrate that the company maintains a healthy governance structure. As of this writing, CFA, a legislation allwoing shareholders in public corporations to have a voting power over executive compensation matters is under the review of the U.S. Senate. I expect this legislation would be passed in near future considering current downturn economic situation in U.S. market and strong support by Obama administration. Even though the Korean Commercial Code requests the shareholder approval on the total compensation amounts which will be scheduled to pay to directors in an annual shareholder meeting, this provision cannot play an effective role in regulating excessive executive compensation in that the approval is not on the specific compensation packages for each director/executive, but only on the total compensation amounts. From this perspectives, I point out in this article that the executive compensation system in Korean public corporations have the similar systemic problems to U.S., and recommend that the public corporations in Korea consider the necessity to adopt a certain form of Say-on-Pay policies to improve the transparency and fairness of the executive compensation system.