Aflac Invites ‘Say on Pay’ Vote

Aflac's board of directors yesterday released the proxy statement language formally inviting shareholders to vote on the company's performance-based compensation. The action marks the first time shareholders will vote on executive compensation for a major American public company. Aflac will announce the results of the vote on May 5, 2008, during the annual shareholders meeting at company headquarters in Columbus, Ga.

Aflac’s executive compensation committee said in a statement that "we believe that our compensation policies and procedures are centered on a pay-for-performance culture and are strongly aligned with the long-term interests of our shareholders."  [link to proxy].

Since August 1990, when Daniel P. Amos was appointed as Aflac's chief executive officer, through December 2007, the company's total return to shareholders, including reinvested cash dividends, has exceeded 3,867 percent, compared with 660 percent for the Dow Jones Industrial Average and 549 percent for the S&P 500. During the same period, the company's market value has grown from $1.2 billion to $30.5 billion.

"Aflac has always been committed to listening to its shareholders," said Amos, also Aflac 's chairman. "The upcoming 'say-on-pay' proposal demonstrates that we care about what our shareholders think, even on topics as sensitive as compensation."

Aflac announced last year that the shareholder vote would occur in 2009, the first year executive compensation tables in the proxy statement would contain three years of data reflecting the Securities and Exchange Commission's (SEC) new compensation disclosure requirements implemented during the 2006 proxy season. However, after evaluating Aflac's compensation disclosures in the 2007 proxy statement, the board of directors concluded that two years of comparable compensation data would be adequate for its shareholders, and the timing of the first "say-on-pay" vote moved from 2009 to 2008.