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Investor Backing for Executive Pay Hits Five-Year High Amid Rising Awards

Financial Times Companies •
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Investor support for executive compensation at S&P 500 companies reached 93.5% in the year to June, marking the highest level since 2022 according to ISS-Corporate data. This five-year peak exceeds last year's 92.4% median support, reflecting growing comfort with well-structured CEO pay packages during the current bull market.

Chan Pedris of ISS Corporate Solutions noted that investors back compensation when it aligns with performance. However, the trend coincides with rising pay awards, particularly stock and option grants. One-time mega grants exceeding $20 million jumped 63% in 2025, including Omnicom CEO John Wren's $69 million long-term incentive award.

Broadcom chief Hock Tan received $205.3 million last year, with 66% investor support. Tesla CEO Elon Musk secured approval for his $1 trillion package backed by 75% of shareholders. Yet European investors remain skeptical, with Norway's sovereign wealth fund opposing large awards.

Morningstar's Lindsey Stewart observed that companies better understand investor expectations, while European investors oppose say-on-pay votes at higher rates. The divergence reflects different market philosophies on executive compensation alignment.