Those who own stock in the largest mall owner in America, Simon Property Group, will soon find out if this is a public company in name only. By about a 3-to-1 ratio, last month shareholders voted down the $137 million pay package awarded to David Simon, the CEO of the business his family founded.
“Institutional Shareholder Services (ISS), which advises stock-owning institutions like pension funds on proxy votes, advised shareholders to vote against Simon Property Group’s pay plan because of the ‘excessive annual reward,'” according to Jeff Swiatek in the Indianapolis Star. He points out the final value of the “front-loaded,” long-term compensation plan will depend on the future trading price of the stock of this locally-based company.
The vote was non-binding and it is still unknown if the the compensation committee will change anything. The company’s initial reaction was to defend the chief executives $5.2 million salary and extra million shares of stock, which ISS called “objectionable.” The board of directors issued a statement saying they”firmly believes it was and is critical to retain Mr. Simon as the company’s CEO.” Apparently they were concerned Simon might jump ship from his family’s company.