Friday, July 31, 2009

Washington, D.C. – Congresswoman Dina Titus of Nevada’s Third District voted today in support of legislation to address compensation plans that encourage executives at large financial firms to take excessive risk at the expense of company shareholders, employees, and the American economy.  H.R. 3269, the Corporate and Financial Institution Compensation Fairness Act, passed the House by a vote of 237 to 185.

“It’s time to shine a light on the runaway executive compensation packages that contributed to the excess risk Wall Street bankers took and hastened our nation’s financial meltdown,” Congresswoman Titus said.  “Making executive compensation more transparent for shareholders and addressing the compensation structure are among the many important steps Congress is working on to prevent a future financial collapse.  This legislation allows for incentives to be paid based on performance, not entitlement.”

The legislation requires publicly-traded companies to allow shareholders to take non-binding votes during annual meetings on the top five executive compensation packages.  It also authorizes federal regulators to develop regulations for financial firms with at least $1 billion in assets that proscribe the use of employee compensation structures that pose a risk to financial institutions and the broader economy.

According to a report released recently by New York Attorney General Andrew Cuomo, nine financial firms that were among the largest recipients of federal taxpayer money paid bonuses of more than $1 million apiece to about 5,000 traders and bankers for 2008.  Congresswoman Titus believes such practices are unacceptable.

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Tags: economy