Activist investors have become the new normal for business. The latest target of an activist is one of the most widely held companies in the world and represents a pushback against one of the best investors in the world: Coca-Cola and its biggest shareholder, Warren Buffett.
The Coca-Cola Co. equity compensation plan for executives won the approval of 83% of the shares voted at its recent annual meeting, but left the company with an ambiguous mandate. Some major institutional investors that supported the plan might have reconsidered had they known other pension funds opposed it and known Warren Buffet thought the plan was “quite excessive.”
Coke has recently come under fire for what it pays its top executives. The overlapping roles that board members play on various company’s compensation committees and the lavish paychecks they receive for such work could be part of the problem.
Speaking from the site of the 2014 Berkshire Hathaway Annual Meeting in Omaha, NE, David Winters tells CNBC’s Becky Quick that he was “absolutely stunned” when he learned about Coca-Cola’s equity compensation plan for executives. He also urged the beverage giant to withdraw the “extreme overreaching” plan, saying it raised questions about Coke’s corporate governance.
- Bloomberg, “Coca-Cola Cuts CEO Kent’s Pay After Revamping Equity Program”
- The Wall Street Journal, “What Is Coke CEO’s Solution for Lost Fizz? More Soda,” By Mike Esterl
- Seeking Alpha, “CEO Pay At Coca-Cola: Up Or Down?” By Paul Hodgson
- David Winters discusses Coca-Cola’s secret “bonus shares” with Maria Bartiromo on Fox Business
- Benefit of Coca-Cola’s Equity Compensation Guidelines Enacted After Public Pressure from Wintergreen Advisers: $6.6 billion to $21 billion
- Wintergreen Advisers Comments on Shareholder Opposition to Coca-Cola’s Executive Pay
- Wintergreen Advisers Cites Changes in Coca-Cola Proxy, But Big Issues Remain
- Wintergreen Advisers Poses Questions for Coca-Cola