Providing for the consideration of legislation to require publicly traded companies to allow shareholders to cast non-binding votes on compensation packages for top executives beginning in 2009 (H. Res. 301)/On adoption of the rules package
house Roll Call 220 Apr 18, 2007
This was the final vote on the rules for debate for a bill to require publicly traded companies to allow shareholders a say in the compensation packages of top executives. The legislation would require that corporations conduct annual nonbinding advisory votes on the compensation of their executives beginning in 2009.
The resolution outlined the rules for debate for the legislation, including how much floor time would be granted to each side and which amendments would be considered in order. The resolution is thus commonly known as the rules package.
Republicans opposed the rules package primarily because of their opposition to the underlying bill. The Democratic-controlled Rules Committee proposed what's known as an "open rule," meaning that virtually all amendments would be allowed on the House floor if they were relevant to the subject of the underlying legislation.
In rising to support the rules package, Rep. James McGovern (D-Mass.) said it represented "a good, appropriate rule that allows any germane amendment to be debated and voted on by this body."
"This rule is appropriate because it allows for real debate and for up or down votes on matters related to this bill," McGovern continued. "I believe this is a good process."
He said he supported the underlying legislation because it "would allow the shareholders, those with the most vested interests, to express their approval or disapproval of a company's compensation practices."
Rep. Pete Sessions (R-Texas) rose to oppose the rule and the underlying legislation on grounds that the latter "constitutes an unnecessary and unwarranted federal intrusion into the free enterprise system and the private sector."
"The legislation that the Democrat majority has brought to the House today would create a new federal mandate on publicly held companies," Sessions continued, "but does so in a half-hearted way that would have absolutely no practical impact on its purported goal of improving disclosure and addressing 'excessive' executive compensation."
McGovern replied that even if Sessions and his Republican colleagues opposed the bill, they could easily support the rules for consideration, as it allowed virtually any relevant amendment. As evidence for his assertion, McGovern pointed out that 10 of the 13 amendments offered were put forth by Republicans.
This vote was on the adoption of the rules package. Even though 55 Republicans ended up voting for the legislation two days later, this procedural vote commanded almost total party unity, as is typical for such votes. Only one Republican voted against the rules package, and Democrats unanimously voted for it (even though five Democrats would go on to vote against the legislation itself). Leaders of both parties command the utmost discipline for these sorts of procedural votes but often give their members wider latitude when it comes to voting for or against the actual legislation.
Thus, on a vote of 227 to 195, the House adopted rules of debate for legislation to require publicly traded companies to allow shareholders a nonbinding say in the compensation packages of top executives beginning in 2009.
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