Wells Fargo and GE are not the only shareholders targeted by progressive activists. Earlier this month One Pittsburgh entered Bank of New York Mellon’s annual meeting as proxy shareholders to demand answers and hold the global one percent accountable.
Rather than forcing them out, like EQT did last week, the CEO and board of directors tried to kill them with kindness. Gerald Hassell, who took over as CEO in 2011, was pressed by the activists for two hours instead of commencing with a typical shareholders meeting lasting just minutes.
According to One Pittsburgh, Hassell takes home $5,937 an hour (eight hour work day is assumed). A proxy stockholder pointed out it would take him 240 years Hassell’s yearly income. In 2010 that sat at just under $11.2 million. In 2008 and 2009 Hassell took home more than $200,000 to sit on Comcast’s board of directors. On his company bio page they tout:
The company has 48,000 employees and is a worldwide leader in investment management and investment services. It has $26.6 trillion in assets under custody and administration, $1.3 trillion in assets under management and services $11.9 trillion in outstanding debt. BNY Mellon has consistently been ranked among America’s Most Admired Companies, as compiled by Fortune magazine.
Admired by the Americans who read Fortune but not the one’s whose life savings disappeared by the casino game banks played with our economy.
Hassell claimed “hard work and God’s graces” for his multi-million dollar yearly earnings, which is more akin to prosperity gospel type of theology. Unfortunately, it would be incorrect because by definition grace is receiving something that is undeserved. It does not matter if one works hard or does all the right things. Grace only comes from God’s own discretion. As a pastor involved in the organization pointed out it raises an important question. Are those who struggle to make ends meet damned in God’s eyes.
Following two hours of questioning the activist shareholders withdrew their attendance when they came to the conclusion the board was not going to change their mind.
BNY Mellon announced a disappointing, according to financial analysts, first quarter revenue with a one percent decrease compared to last year.
BNY Mellon, which joins Boston’s State Street Corp. in reporting lower profit, said revenue from foreign exchange trading, the subject of lawsuits against the bank, declined 21 percent from a year earlier. Chief Executive Officer Gerald Hassell, who in November outlined expense cuts designed to save as much $700 million before taxes by 2015, said some savings are already materializing as compensation and software expenses fell.
The savings from compensation come from cutting jobs. 1,500 of them or three percent of the total workforce. Meanwhile their top five executives were paid $59 million in 2010. A similar timeframe the company is alleged, in multiple lawsuits, to have deceived pension funds by overcharging them. The story quoted above conveniently leaves out the type of lawsuits that cost shareholders a higher profit margin.
Link the two together. Higher ups earn millions of dollars and engage in business practices that result in lawsuits and ultimately hurt the company. Yet, employees further down the totem pole suffer the consequences by losing their jobs. All to offset the lost revenue.
Two wrongs do not make a right. I hope BNY received that message.
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