SunTrust exec defends Coke, pay policies
By Peralte C.Paul
ATLANTA — Corporate annual meetings are usually tightly choreographed affairs — opportunities for management to highlight its best steps of the prior year in front of employees, shareholders and customers.
SunTrust Banks Inc., which had its annual shareholders' meeting Tuesday, had just that for the most part.
Of course, the one-two step that management really can't control is the shareholder.
On Tuesday, a father and son team of shareholder activists from Charlotte peppered SunTrust executives with questions about the raises and bonuses senior executives enjoy compared with rank-and-file workers.
The pair, John Moore, and his son, Kent, said they talked to a Charlotte bank teller who told them SunTrust gave her a 1 percent raise last year, despite decades of service.
"I'm concerned about jobs and the compensation of front-line workers," John Moore said before the meeting. Front-line employees' pay isn't keeping pace with executive bonuses, stock options and other perks, he said.
"People have a real sense of what's fair and equitable," he said. "A change needs to take place here."
Executive pay raises — and pressure to disclose more details about compensation — have become a hot issue again among investors in general who question whether corporate America's chiefs are worth the millions they're paid each year.
John Moore, 69, who said he owns about 70,000 shares, also urged the company to divest its nearly $2 billion worth of Coca-Cola Co. stock.
Coke's lackluster performance of the last few years hasn't warranted holding onto them, he said.
Plus, the company has been on the hot seat in recent years as consumers have focused attention on the nutritional values of sugared snacks, Coke's impact on the environment and its high-profile racial discrimination lawsuit, he said.
"Is this the kind of company you want to be associated with?" said Moore, whose SunTrust shares were worth close to $5.3 million as of Tuesday's closing price of $75.63.
L. Phillip Humann, SunTrust's chairman and chief executive, responded that the company's Coke holdings, which go back to 1919, generate about $100 million in benefits to the company each year, either through dividends or tax advantages.
As for the pay, he said merit raises averaged 3 percent last year and that it was unfair to make a characterization about some 33,000 employees based on one teller.
But it wasn't all scolding for SunTrust executives. Janice Mathis, a representative of the Rainbow/PUSH Coalition, said the company had improved its diversity numbers among its rank-and-file employees, but she said the bank needs to improve diversity among senior management.
She also said the bank needs to do better at giving minority-owned businesses access to capital.
Humann said that SunTrust is always looking for opportunities to do more business with firms owned by minorities and women, but he did not directly address the issue of diversity in the company's senior ranks.
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