CalPERS announces plan to reform executive compensation practices.

The California Public Employees' Retirement System's Board of Administration has approved a plan advocating executive compensation reforms on a national level. CalPERS will wage a campaign against targeted individual compensation committee directors who support egregious pay packages and the companies that have the worst compensation practices. The retirement system plans to work with the Securities and Exchange Commission, the financial exchanges, and the compensation consulting industry to address issues of transparency in executive compensation.

Under the plan, CalPERS will pursue six major pay-for-performance initiatives over the next three years:

* Submitting a comprehensive proposal to the SEC in 2005 that calls for greater transparency of compensation packages.

* Strengthening listing standards at the securities exchanges and self-regulatory organizations to promote greater communication and transparency between listed companies and investors.

* Urging the compensation consulting industry to adopt practices that better align boards and management with shareowners.

* Targeting a limited number of corporations in 10 market sectors with the worst compensation practices to move their executive compensation philosophy and practices toward greater pay-for-performance concepts.

* Publicly withholding support from a focused list of certain corporate compensation committee members who develop and support egregious pay packages.

* Recognizing companies and individuals who use superior pay-for-performance practices.

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