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St. Louis Post-Dispatch David Nicklaus column
Apr 13, 2012 (St. Louis Post-Dispatch - McClatchy-Tribune Information Services via COMTEX) --
Belden thinks it pays its executives reasonably, and it wonders why a lot of its shareholders disagree.
The Clayton, Mo., maker of cable and networking products paid Chief Executive John Stroup $4.7 million last year, down 13 percent from the previous year. His 2010 pay was swelled by a stock grant, but overall Stroup made less in 2011 than in 2009, and the company's earnings per share nearly doubled in two years.
In a proxy statement filed this week, Belden says its pay is hardly out of control. Compensation policy is full of shareholder-friendly practices, it says, such as holding executives to tough performance standards and not paying the taxes on their perquisites. Despite all that, when Belden held its first "say on pay" vote last year, 31 percent of the votes were "no."
The average dissent rate at U.S. companies was less than 10 percent, so Belden clearly had a high number of disgruntled shareholders. It didn't have much luck learning why, though. After the vote, the proxy statement says,
We sent a letter to our top 20 stockholders describing our views and making our senior management available to discuss any compensation related concerns. We followed up on the letter with phone calls to major holders. Almost unanimously, these stockholders continued to emphasize their positive feelings about Belden and expressed little interest in discussing our compensation program.
... As suggested by the industry literature, we monitored the SEC Form N-PX filings of our major fund holders in order to identify those holders who voted at least some of their shares against our proposals. In following up with these particular stockholders, a common theme developed. The portfolio managers who buy our shares are not necessarily aware of how those shares are voted on proxy matters. Many were surprised to hear that we had information showing that their fund had voted against our proposals.
Belden says it's committed to communicating better with shareholders before the 2012 vote, which is scheduled for May 30:
Our mission is clear in 2012: gain universal support of our executive compensation.
Perhaps Stroup's smaller pay package, in a year when profits rose 25 percent before unusual items, will help sway some shareholders. Belden's share price, however, fell 9.6 percent in 2011.
Stroup did get a big salary increase last year, to $775,000 from $700,000, along with a bonus of $1.05 million. He also got $2.5 million worth of options, a $317,882 increase in pension value and perquisites that included $3,775 in club dues and $2,472 in tax-preparation fees.
If he leaves Belden after a takeover, Stroup can collect $10.7 million, including $4.7 million in cash severance and bonus.
Read more from David Nicklaus, who is the business columnist for the Post-Dispatch. On Twitter, follow him @dnickbiz and the Business section @postdispatchbiz.
___ (c)2012 the St. Louis Post-Dispatch Visit the St. Louis Post-Dispatch at
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