Sempra shareholders vote in favor of pay increases for executives
San Diego Gas & Electric customers protested high rates outside the downtown headquarters of the utility’s parent company Sempra on Friday as shareholders voted to approve millions of dollars in pay increases top executives received in 2021.
The so-called “say-on-pay proposal,” which is non-binding, allows the company’s investors to weigh in on whether they agree with the company’s executive compensation plan.
The annual shareholder meeting followed a year of record profits, but also a customer backlash after spikes in energy bills. Some reported their bills doubling or tripling. The company blamed an unusual jump in the cost of natural gas.
Danielle Wilkerson, justice and equity coordinator for the climate change advocacy group SanDiego350, helped organize the rally on Friday, where roughly twenty people, including some dressed mockingly as utility executives, carried signs urging Sempra to do more to stop climate change before the shareholder meeting was set to begin at 9 a.m. Wilkerson said the purpose of the protest was to raise awareness that San Diego customers were getting “ripped off.”
Wilkerson said she wanted the company to stop “blocking rooftop solar” as the state considers changes to rooftop solar regulations that critics say will make it more expensive and harder to access. She also said she wanted Sempra to stop “lining the pockets of the Sempra executives and shareholders at the expense of San Diegans.”
She said she wanted shareholders to hold Sempra accountable.
San Diegans already pay the highest per-unit electric costs in the country and consumer advocates are fighting the utility over its profit margins. Another fight over San Diego Gas & Electric’s rates will start next week when the utility is expected to start making its case for its rates in 2024 to 2027 rates in front of the California Public Utilities Commission.
The shareholders on Friday morning voted to support 2021 base salary raises for top Sempra executives of 3.8% to 8.3%, though their approval is only advisory in nature.
Most of the top executives’ pay is tied to the company’s performance. Sempra board chairman and CEO Jeffrey Martin received nearly $25 million in 2021, of which 17% percent was a performance-based annual bonus. His total compensation in 2020 was $23 million.
The other top five named executives brought home between $1.4 million and $8.3 million in 2021.
The company’s record profits have continued into this year. The company has already given shareholders one round of record-high dividend payouts this year and expects the trend to continue. Sempra brought in $924 million in the first three months of 2022, according to a May report, slightly more than $900 million in 2021. Investors will get their second payout of the year of $1.145 per share on July 15. The payouts are the highest in the company’s history.
The shareholders also voted down a proposal by shareholder John Chevedden, who’s been written about as an activist trying to change corporate governance to give shareholders more power. The proposal would have forbidden the same person from holding the roles of both chief executive officer role and the chairman of the board of directors. The proposal also lost in a 2012 shareholder vote with 42% support, Chevedden said at the meeting Friday before the vote.