Goldman Sachs (NYSE: GS) has started meeting with some of its major investors in an effort to quiet criticism over the record compensation packages that it has paid some of its top executives. These meetings are the first of their kind and will likely continue for several more weeks.
The company is defending its compensation packages, which average over $700,000 per year. Goldman Sachs is hoping to win support for its high-compensation packages with its investors. Since investors are the actual owners of the firm, they hold the power to change the company’s compensation structure via means of a vote of shareholders. Although employees and executives hope there will be no additional changes, heavy campaigning is going on within the ranks of Goldman Sachs owners.
According to a report released by the Wall Street Journal, some investors say that Goldman Sachs is creating a strategy to navigate any proposals that shareholders might bring up to limit compensation packages. Some believe that these proposals will be voted on this spring. Out of the five shareholder proposals submitted to Goldman Sachs, three are related to executive compensation.
Goldman Sachs company spokesperson Lucan Van Praag has said that shareholder feedback has been “very supportive”.
A representative from TIAA-CREF, which holds $1 billion in Goldman Sachs stock, noted that the meetings “are a constructive first step, and the next logical action would be for Goldman to proactively consider putting its compensation policies to a vote of shareholders. If Goldman Sachs acts the rest of Wall Street will likely follow.”