Legg Mason investors approve executive pay package

Legg Mason Inc. shareholders approved a $5.9 million pay package for Chairman and CEO Mark R. Fetting in an advisory vote announced Tuesday at the Baltimore-based company's annual meeting.

The nonbinding "say on pay" measure won the support of 87 percent of voting stockholders. Shareholder guidance group Glass, Lewis & Co. had recommended that investors vote against the company's executive compensation package.

The Glass, Lewis report criticized the firm's executive pay practices, saying the asset manager had paid top officers slightly more but performed slightly worse than its peers. Legg defended its CEO incentive compensation, saying it was in line with the company's improved performance during the 2011 fiscal year.

Fetting's total compensation, which included an incentive-based cash bonus of $2.9 million, rose 28 percent in fiscal 2011 over the previous year. The company's profit increased 24 percent, to $253.9 million, in the same period.

Shareholders also reelected five directors in votes announced Tuesday. Glass, Lewis had advised shareholders not to vote for one of the five, Harold L. Adams. Adams has served on the compensation committee over the past two fiscal years, when "the company was deficient in linking pay with performance," the Glass, Lewis report said.

This year, shareholders at most publicly traded companies are casting advisory votes on executive compensation for the first time, with most investors voting in favor of the pay packages. The new SEC rule giving investors a say on pay was designed to allow more scrutiny of executive compensation.

Compensation packages have been approved by investors at Maryland companies Under Armour, McCormick & Co. and T. Rowe Price, but pay for executives of Baltimore-based Constellation Energy Group failed to win shareholder support. The vote was nonbinding.


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