Dodd-Frank says only independent directors can set executive compensation at some companies. Does the fact that those directors also get paid to lobby for the company mean they are not independent? Apparently, it is the Board that determines whether it’s directors are sufficiently independent. And the Board knows that these folks do lobbying for the company, and aren’t concerned that the directors might tend to be more generous to the CEO who effectively pays both their salary and their consultants’ fees.
What does it say about a company’s culture that the Board is a bit flexible on the whole “independent” thing? Having lobbyists is fine, but do the same people really have the proper creds (both credentials and credibility) to be an independent check on CEO pay?