WOONSOCKET – CVS Caremark Corp. will allow its shareholders to vote on how much it plans to pay its top executives starting next year.
Conn. State Treasurer Denise L. Nappier said CVS will hold a nonbinding vote on the issue during its 2011 shareholder meeting. Nappier is the principal fiduciary of the $23 billion Connecticut Retirement Plans and Trust Funds, which owns about $15 million worth of CVS shares.
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“The public is outraged by oversized paychecks that reward poor performance, and rightfully so,” Nappier said. “As American families and small businesses cope with widespread job losses, massive pay cuts and limited access to credit, they are sick and tired of watching boards give underperforming executives a blank check and a pat on the back.”
CVS Caremark confirmed the decision in a statement to Pensions & Investments, a newspaper owned by Crain Communications Inc.
CVS Chairman, President and CEO Thomas M. Ryan received $54.4 million in total compensation in 2008, making him the highest paid executive at a Rhode Island-based public company, according to Providence Business News data.
After Ryan, the CVS executive paid the most was Chris Bodine, a special adviser to the CEO ($37 million). He was trailed by former Caremark division head Howard McLure ($11.6 million); Chief Legal Counsel Douglas Sgarro ($6.5 million); and former Chief Financial Officer David Rickard ($5.6 million), who retired at the end of last year.
Nappier hailed CVS for agreeing to the “say-on-pay” vote. A majority of CVS shareholders voted to support Nappier’s proposal for the balloting at last year’s annual meeting.
“By granting shareholders the right to provide input on its pay practices, CVS Caremark has demonstrated that it has nothing to hide in the manner it compensates its executives,” she said. “More companies should do the same.”
