(Reuters) - In a rare case of shareholder pushback, Smith & Wesson parent American Outdoor Brands Corp (AOBC.O) on Tuesday failed to win majority support for its rising executive pay, according to a transcript of the gunmaker’s annual meeting.
American Outdoor’s proxy statement shows pay raises for top executives including Chief Executive Officer P. James Debney during the fiscal year ended April 30, 2019. For that period Debney received total pay of $3.8 million, up from $2.2 million in the same period a year earlier.
Proxy advisory firms Glass Lewis & Co and Institutional Shareholder Services Inc (ISS) recommended that shareholders vote “against” the executive pay raises.
In a report seen by Reuters, ISS said the performance targets under the annual incentive were set lower than last year, resulting in “above-target awards”.
Last year only about 2% of companies the size of American Outdoors failed to win majority support for the advisory measures on the pay of top leaders, according to consulting firm Semler Brossy.
Shares of American Outdoor closed down 2% at $5.96, and have fallen more than 50% this year.
The company’s profit fell 8.5% to $18.4 million in fiscal 2019, its second consecutive drop in annual profit.
A spokeswoman for the Springfield, Massachusetts, company did not respond to requests for comment.
The meeting transcript also showed that a proposal calling for the company to adopt a human rights policy was not approved.
The company and rivals including Sturm Ruger & Co (RGR.N) have been under pressure amid a series of mass shootings at U.S. schools, colleges and houses of worship such as an attack in West Texas on Aug. 31 that killed seven and wounded 22 others, including a toddler.
Reporting by Ross Kerber in Boston and Sanjana Shivdas in Bengaluru; Editing by Chizu Nomiyama, Matthew Lewis and Shounak Dasgupta