You know those little dogs that sit on the laps of rich women? Well, CEOs have them too. Their name is ISS.
If you own stocks, a mutual fund, a retirement fund or anything involved with the stock market, Institutional Shareholder Services is supposed to be looking out for you. Since most stocks are owned by mutual funds or index funds, there are very few people actually paying attention to what goes on within a company, in terms of executive compensation and many other matters.
ISS is supposed to be a private watchdog for such matters, and generally mutual funds and index funds will simply follow the ISS lead in terms of shareholder votes. So what ISS recommends is critical.
But ISS is owned by a Park Avenue Wall Street firm, Vestar Capital Partners. And in the cozy world of Wall Street insiders, ISS is more lap dog than watchdog.
They didn’t stop Valeant CEO Joseph Papa from ripping off over $63 million for seven months of work last year while Valeant’s stock dropped by 55%.
They didn’t stop Yahoo from paying Henrique de Castro $109 million to be Chief Operating Officer of Yahoo for 15 months from November 2012 to January 16, 2014.
And now ISS won’t stop Yahoo’s CEO from getting paid a $187 million bonus for 5 years of incompetent management, in addition to the $40 million she has already been paid.
Most people assume that someone - a board of directors, a watchdog like ISS, or some government agency like the Securities and Exchange Commission - will stop grand thefts such as this. But that is simply not the case. Throughout America, institutions have failed, and there is no one to protect an investor - or anyone else - who is not allied with some big institution.
And all sense of decency and restraint has left the boardroom, so managers feel no shame when they steal.
Those of us, small investors, often saving for retirement, are tired of getting ripped off by management. We're mad as Hell and we're not going to take it anymore. Sure, fighting any big institution is tough, but things can change.
Help us bring change to the boardrooms of corporate America by signing our petition and voting no at the Yahoo Board meeting on June 8.