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DMA proxy fight urges 'Say-on-pay'

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New York—As the Direct Marketing Association gears up for its annual conference and exposition next month in Boston, a rearguard proxy fight by a DMA board member once again is urging reforms of association policies, including executive compensation. DMA board member Gerry Pike, who spearheaded an association reform movement two years ago that led to an expanded board and a change in leadership, is urging members to demand a “Say-on-pay” and greater transparency into how DMA executive leadership is compensated. “This really is continuing what members have asked for,” Pike told BtoB. “No one has understood executive compensation at DMA, even members of the board. Contracts have been concealed from members. Members should not have to take a pick and shovel to understand how their dues are spent.” As he did in 2009, Pike has emailed DMA membership requesting their voting proxies in advance of the association's annual business meeting Oct. 2. Say-on-pay would require an annual report on senior executive compensation, including bonuses, and grant members an advisory vote on approval of staff pay. The DMA vigorously disagreed with Pike's representation that executive compensation is hidden or out of line. “We're a bit shocked that this would come up,” said Larry Kimmel, CEO of the DMA since the summer of 2010. “We were brought in to turn the place around, and our success has been pretty amazing, with assets up 51% over last year, and membership growth for the first time in years.” Kimmel said Pike presented his concerns last May at a 40-member board meeting, with the board voting 39 to 1 that the DMA's executive compensation is appropriate and fair. According to Pike, Kimmel is being paid somewhat more than $500,000 annually, with the prospect of bonuses beyond that if certain performance goals are met. Kimmel's predecessor, John A. Greco, reportedly earned about $770,000 annually toward the end of his contract, plus $128,194 in benefits and deferred compensation. Kimmel said his compensation is in line with executives at such other associations as the Interactive Advertising Bureau and the American Association of Advertising Agencies. Pike's proxy fight in 2009 focused on rising membership dues, the association's level of political advocacy and the processes used in setting Greco's compensation. It was resolved amicably within the membership and board, with Greco resigning in early 2010.
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