CA Shareholders Reject Compensation Recovery Plan - InformationWeek

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8/26/2004
12:53 PM
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CA Shareholders Reject Compensation Recovery Plan

Executives urge patience as the company continues to review payments to executives who left in the wake of an accounting scandal.

Computer Associates shareholders Wednesday rejected a proposal calling for the company to seek to recoup compensation to executives who left the company in the wake of investigations into illegal accounting practices at the company in 2000.

Chairman Lewis Ranieri asked investors to be patient as the compensation issue remains under review. Ranieri also said that the search for a permanent CEO remains ongoing and that current interim CEO Ken Cron is a candidate to take the position on a permanent basis.

Although Cron had earlier said he wouldn't be a candidate to be a permanent CEO, a CA spokeswoman said he has now decided that he will "cross that bridge if and when it comes."

In commenting on the ongoing government investigation that led to the firing of a number of leading executives and the resignation in June of former chairman and CEO Sanjay Kumar, Ranieri said, "I want to make it clear that the actions that occurred during the period of investigation were wrong. The individuals responsible are no longer with the company.

"We are taking aggressive steps to ensure that these unacceptable practices will never occur at CA," he told shareholders. "We are working with the government to resolve all outstanding issue and are reviewing compensation paid to certain officers in prior years."

In May the company set aside $10 million to pay fines associated with the ongoing Securities and Exchange Commission and Department of Justice probes. The money was viewed as an "initial offer" to the government to settle the case.

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