New York, July 26: Stock investors -- still smarting over Enron, WorldCom and other recent corporate scandals -- have turned their attention to new targets: compensation committees and executive pay. Critics say that while the corporate governance reforms so far have been good, they are only the first step and must be continued -- especially as the stock market improves and investors focus more on making money and less on cleaning up past problems.
Now that many new standards have been adopted or proposed, investors are demanding that boards' compensation committees be more than just independent. They also have to demand more for the often enormous amounts of money paid to top executives.

"You can still have three stuffed monkeys on the compensation committee, but as long as they are independent, it is OK," said Ralph Ward, author of "Saving the Corporate Board: Why Boards Fail and How to Fix Them," referring to new standards proposed by the New York Stock Exchange.
Unlike the new rules created by the Sarbanes-Oxley Act of 2002 that took aim at crooked accounting and biased Wall Street research, there are no new regulations covering executive pay.
Any efforts to rein in fat paychecks are strictly voluntary and mark a key test of boards' commitment to move away from excessive compensation, corporate governance experts said. Bureau Report