Feeds

Oracle defends Larry Ellison's whopping package

Firm tells shareholders chief's million-dollar compensation is 'appropriate'

Next gen security for virtualised datacentres

Oracle has hit back at shareholder claims that founder and chief Larry Ellison’s pay package is too generous, saying his compensation is “appropriate under the circumstances”.

Like many tech titans, Ellison receives a nominal $1 pay cheque and has been known to refuse bonuses, but is nonetheless compensated by stock options. In the fiscal year ended 31 May, Ellison’s compensation was valued at around $76.9m.

Stockholders have already shown they’re not too chuffed with Ellison’s whopping package, with the majority rejecting the company’s pay practices in a non-binding Say on Pay vote last year.

CtW Investment Group, which doesn’t own Oracle stock itself but says it represents shareholders, last week wrote to Oracle (PDF) to inform the firm that it would be urging all stockholders to vote against pay practices again at this month’s meeting. It also said it would potentially look to oust current directors if the company didn’t limit stock option grants and bring in someone new to oversee executive pay.

But the company said in a letter to CtW filed with the SEC that Ellison’s pay is linked to Oracle’s performance and thereby linked to his value to the shareholders.

“Mr Ellison’s compensation consists primarily of at-the-market unvested stock options that put his compensation in direct alignment with Oracle’s shareholders. Without reopening a debate about stock option valuation, you are no doubt aware that Mr Ellison has received stock option grants that have expired worthless, as well as grants that have performed well – aligning his interests directly with the interests of all Oracle shareholders,” general counsel and board secretary Dorian Daley wrote.

Daley claimed that CtW seemed to be more concerned with the vote on Say on Pay last year than the current state of Ellison’s pay.

“It appears that you base much of your opposition on the fact that a majority of shareholders did not support the Say on Pay advisory vote last year. I can assure you that we take the advisory vote extremely seriously. But, as you are aware, it is advisory only,” he said.

“Although the advisory vote was not definitive, we certainly did not ignore the vote, as you assert. Our Board of Directors and our management took into account the views of our shareholders - including but certainly not limited to the advisory vote – and then the Board exercised its business judgment and made its decision based on full information.

“What occurred, and what appears to be the core of your complaint, is that we came to a different conclusion than Change to Win. I urge the shareholders for whom you purportedly speak to review the proxy carefully, and, with the Company’s goals and leadership in mind, to vote “for” the Say on Pay resolution and in favour of each of our Directors as recommended by the Company,” he added.

CtW works with pension funds sponsored by unions affiliated with Change to Win, a federation of nearly 5.5 million workers that tries to influence corporations. The investment group tries to change shareholder returns through active ownership and has also worked to change board decisions at companies including HP, Tesco and JP Morgan.

Daley asserted that CtW’s attempts to promote reasonable executive compensation on behalf of pension funds was blinding it to the business reasons for Ellison’s pay.

“Perhaps the problem is that we may not disagree on the facts, but rather we disagree on the goals,” he wrote. “The publicly stated goal of the CtW Investment Group is to, among other things, promote 'reasonable executive compensation' on behalf of a particular class of investment fund, namely pension funds. You therefore take the facts and apply a results-oriented analysis because you start from the perspective that Mr Ellison’s pay is not 'reasonable'. In our view, that is not a fair or balanced analysis.

“Conversely, our Board has a responsibility to conduct a fair and balanced analysis and to ensure the continued success of the company in an intensely competitive marketplace for the benefit all of our shareholders, including the shareholders you purport to represent.” ®

Secure remote control for conventional and virtual desktops

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
No, thank you. I will not code for the Caliphate
Some assignments, even the Bongster decline must
Kaspersky backpedals on 'done nothing wrong, nothing to fear' blather
Founder (and internet passport fan) now says privacy is precious
TROLL SLAYER Google grabs $1.3 MEEELLION in patent counter-suit
Chocolate Factory hits back at firm for suing customers
Mozilla's 'Tiles' ads debut in new Firefox nightlies
You can try turning them off and on again
Sit tight, fanbois. Apple's '$400' wearable release slips into early 2015
Sources: time to put in plenty of clock-watching for' iWatch
Facebook to let stalkers unearth buried posts with mobe search
Prepare to HAUNT your pal's back catalogue
prev story

Whitepapers

Endpoint data privacy in the cloud is easier than you think
Innovations in encryption and storage resolve issues of data privacy and key requirements for companies to look for in a solution.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Advanced data protection for your virtualized environments
Find a natural fit for optimizing protection for the often resource-constrained data protection process found in virtual environments.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.