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May 2 (Reuters) - A major proxy advisory firm recommended shareholders vote against Goldman Sachs Group Inc's executive compensation plan and added that Morgan Stanley was also paying its top staff too much.
Glass Lewis & Co issued the recommendations ahead of the banks' annual meetings where shareholders vote in a non-binding motion on executive pay.
The criticism of executive compensation comes after a Wall Street Journal report that Coca-Cola Co is likely to revise its equity compensation plan for executives following pressure from top shareholder Warren Buffett.
Glass Lewis said that the two banks were planning to pay too much, considering their performance was lagging their rivals - particularly in the case of Goldman Sachs.
"Overall, the company paid more than its peers, but performed moderately worse," the proxy advisory firm said in a paper prepared for investment funds who pay for its advice.
Glass Lewis also recommended that shareholders vote against the reappointment of one director at each bank to show their displeasure.
The advisory firm lowered its rating on Lloyd Blankfein-led Goldman to "F" from "D".
Glass Lewis gave Morgan Stanley a "D" rating, saying that the company paid about the same as its peers while performing worse. It had an "F" rating previously.
The proxy advisory firm recommended Goldman shareholders to vote against the reelection of the pay committee's chairman James Johnson.
Morgan Stanley shareholders were also urged to vote against the re-election of director James Owens, citing the company's failure to provide sufficient disclosures regarding transactions with entities affiliated with its directors. (Reporting by Avik Das in Bangalore; Editing by Sriraj Kalluvila)