WELLS FARGO CASE HIGHLIGHTS THE NEED FOR SERIOUS OVERHAUL OF EXECUTIVE COMPENSATION

As a shareholder of Wells Fargo, I've been following the news about allegations of fraud committed by some of their executives to boost their compensation.  While I'm a firm believer in performance based pay packages, if it's found that fraud is committed as an effort to boost compensation, then I believe every effort should be made to retrieve the money paid to the individuals involved.  In the most recent article I read, the CEO of Wells Fargo was talking about possible "claw back" actions being invoked by the board of directors, but it didn't say they were actually going through with it.  In my opinion, failure to do so shows an egregious lack of responsibility on the part of the board of directors and should result in a call for their replacement.  The board of directors are supposed to represent the best interests of the company and it's shareholders (i.e. owners of the company, which I think they tend to forget).  If they fail to do so, then they need to be fired!

As far as I'm concerned, this whole situation brings up the need for a close look by all shareholders of every U.S. corporation at executive pay packages.  One of the people involved in the fraudulent practices at Wells Fargo is reportedly walking away with over $124 million in compensation.  The real question shareholders should be asking at this point is, why was this woman getting paid so much in the first place.  Here again, it goes back to the board of directors who repeatedly approve these outrageous pay packages.  Yes, I believe that good people should be paid well for their work, but come on!  What did this woman possibly do that would merit such high pay.  Apparently nothing, as it turns out.

So really, what it all boils down to is, we as shareholders (owners) of the companies doing business in the U.S. need to start demanding better representation of our interests from the board of directors.  If they fail to look out for our interests then they need to be replaced with people who will.  I'm not picking on Wells Fargo in particular and I do intend to hold on to my shares.  I'm sure these practices go on at other banks and they just haven't been caught yet.  I'm also equally sure that executives are way over compensated at most major corporations.  It's time shareholders put a stop to it.