Notice of Petition - "Compensation, Retirement Programs and Related Benefits"
April 22, 2013
Mr. Barry Mardock
Office of Regulatory Policy
Farm Credit Administration
1501 Farm Credit Drive
McLean, VA 22102-5090
Dear Mr. Mardock:
I am writing this email in support of the Regulatory Petition submitted by The Farm Credit Council (FCC) and the comment letter dated April 16, 2013 filed by the FCC.
I have been an employee of the Farm Credit System for over 39 years and a Senior Officer for the past 25 years. During my tenure with the System, I am unaware of any stockholder requesting additional information on the Association’s Compensation Policies or the compensation of any Officer. System disclosures to the stockholders on compensation and other matters has ramped up quite a bit over the past 20 years – today, we are publishing a 50 page Annual Report that covers all areas of the Institution’s operations including total compensation for the CEO for the past 3 years – this report is mailed to all stockholders and broadcasted to the World on our Website for all to see. We are very transparent in our operations. The stockholders elect directors to enact policy for the institution, hire and set the compensation of the CEO, and provide compensation governance through the Compensation Committee of the Board which is made up of Board members who are elected by the stockholders.
Here in Southwest Oklahoma, we compete and cooperate with small community banks and credit unions – it takes all of us working together to serve the needs of our communities. I am also personally a shareholder and member of a credit union. While AgPreference, ACA consistently provides substantial disclosure and information to the public via the Association’s Website and to stockholders via mail, I am unaware of any such disclosure or information being provided to the public by the community banks or the credit unions. We are all either Federally or State regulated. We don’t have federally insured deposits like the community banks or credit unions but sell securities on the market to raise funds. I believe that our disclosures are more than adequate when compared to other institutions in our area who hold the public trust and a Federal Charter like we do or a State Charter.
As with all cooperatives, including this Association, the stockholders elect Directors to provide governance. The Compensation rule, and specifically the advisory vote imposed on the System by FCA is a solution for a problem that does not exist. We are already much more transparent in our operations than the other Federal or State chartered Financial Institutions who operate in Southwest Oklahoma.
This institution will oppose any advisory vote by stockholders. FCA has alluded to additional advisory votes in the Rule’s preamble. This does not mean that we are against stockholder involvement – we already have that via the election of Directors by the stockholders and a high level of transparency via disclosures. We believe that advisory votes would undermine the governance by Stockholder Directors who are elected by the Stockholders to insure that the Association remains safe and sound. In addition, such advisory votes could bring litigation risk to System institutions and Directors without adding any benefit.
We respectively request that you withdraw this misguided rule.
Cecil H. Sheperson
President and CEO
3120 N. Main Street
Altus, OK 73521
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