Proxy adviser says Sprint CEO was paid too much
PETER SVENSSON, AP Technology Writer July 24, 2014 6:40PM
Softbank Corp. President Masayoshi Son, left, and Sprint Nextel Corp. Chief Executive Dan Hesse shake hands during their joint press conference in Tokyo Monday, Oct. 15, 2012. Tokyo-based mobile carrier Softbank has reached a deal with Sprint to acquire 70 percent of the U.S. wireless company for $20.1 billion in the largest ever foreign acquisition by a Japanese company. (AP photo/Koji Sasahara)
Updated: July 24, 2014 6:49PM
NEW YORK — Institutional Shareholder Services, a leading shareholder advisory firm, is telling shareholders to protest Sprint Corp. CEO Dan Hesse’s $49 million 2013 pay package, saying it’s excessive and not tied to performance.
Hesse got a special $18.7 million “retention” award in connection with Softbank Corp. of Japan buying 70 percent of Sprint last year. That helped put his pay package above three times the median pay for a CEO of a comparable company, ISS says.
Shareholders will vote on approving the executive pay package Aug. 6. The vote is only advisory, but boards take “no” votes seriously.
Sprint, which is based in Overland Park, Kansas, had no immediate comment on the ISS report.
It’s not the first time Sprint has been criticized for Hesse’s pay. In 2012, he gave up part of his salary after shareholders complained that this compensation formula was tweaked to eliminate a reduction he would have taken for the earnings hit caused by initial sales of the iPhone. Phone companies sell smartphones at a loss, and the iPhone is more expensive than the competition.
Sprint is the No. 3 U.S. cellphone carrier, behind Verizon and AT&T. Last July, Softbank bought the controlling stake in Sprint for $21.6 billion.