Daniel Brockman

IPI Incomes Parity Initiative

A shareholders’ resolution...

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WHEREAS:

Data: US Census

1. As shareholders, we want the business of [The company] (“company”, herein) conducted in a manner not merely consistent with our own interests, but fairly in the interests of our employees, users and buyers of our products and services, suppliers and the general society.
2. Extreme disparity of incomes in the general society
1. creates a negative economic externality
2. results in social stratification manifesting
   1. distortion of democratic processes and
   2. emergence of a social class resembling aristocracy.
3. In our era, our society produces and distributes goods, services and incomes via corporations such as the company.
4. The company provides an admired, influential, leading example for other companies worldwide.

RESOLVED:

We request that the board of directors implement an Incomes Parity Policy (“Policy”, herein) such that

1. The annualized rate of compensation of the least well compensated employee of the company will be more than 1/70th (one seventieth) of the annual rate of compensation of the most highly compensated employee. This is the core principle of the Incomes Parity Policy.
2. “Employee”, as used here,
   1. during the first year of effectiveness of this Policy, and thereafter, refers to any employee, director, executive officer, whether “exempt” or “non-exempt” or “temporary” or “permanent” or “full time” or “part time” or “casual” or otherwise, without regard to geographic location.
   2. during the second year of effectiveness of this Policy, and thereafter, refers additionally to any person providing labor or services comprised significantly of labor, by formal or informal contract with an agency or union or directly, including all consultants and other workers.
3. “Compensation”, “compensated”, etc., as used here, refer to all salaries, wages, bonuses, equity awards, contractual payments, fees, stock options, payments in kind and deferred income, and similar transactions, including, but not limited to, all forms of compensation mentioned in the Executive Compensation section of the annual proxy statement and other forms of compensation of employees. “Compensation” does include dividends and change in value of shares of stocks and financial instruments awarded to an employee as compensation. “Compensation” doesn’t include dividends and change in value of ordinary common stock purchased by the employee with their own funds.
4. The board will interpret the Policy broadly, to defeat attempts to circumvent the meanings of “Employee” and of “Compensation”.
5. The board will oversee the amounts and timing of adjustments of employees’ compensation.
6. If existing contracts bind the company, the company will honor them, but new, extended and renewed contracts will comply with the Policy. The board, at its discretion, may incur significant and material costs to cancel or modify contracts to achieve compliance with the Policy.

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The text of the above resolution, excluding graphics, is less than 450 words. I am grateful for the advice of friends who reviewed early drafts.

Sources consulted:

Alphabet Inc.,  2016 Proxy Statement 
Craig McGuire, “How to write a shareholder proposal”  (2012) 
Daniel Brockman, "The 1% and the 99%" (Nov 13, 2011)
U.S. Census, current population survey household income data tables (http://www.census.gov/hhes/www/cpstables/032012/hhinc/toc.htm downloaded Nov 2011, no longer available. See www.census.gov.)

This entire article is a free cultural work (CC0  2016). Anyone may use it for any purpose without seeking permission.

To the extent possible under law, Daniel Brockman has waived all copyright and related or neighboring rights to Incomes Parity Initiative. This work is published from: United States.