Internal investigations have unveiled issues in areas such as mortgage lending and auto insurance, while the wealth and investment management division is being analyzed for problems.
Apart from the illegal customer accounts scandal, Wells Fargo has faced several other controversies too, the most recent one being the possibility of regulatory sanctions for taking payouts on auto insurance policies that were forced on auto borrowers.
Last October, Sloan was criticized by US Senator Elizabeth Warren over the fake accounts scandal. While defending himself, Sloan dismissed her comments as ‘misinformed’.
Wells Fargo’s net earnings growth of slightly above 1% and its flat revenues in 2017 does not corroborate the company’s justification for Sloan’s pay package, which it said reflected solid financial performance. The bank’s shares had a moderate increase last year.
Just last week, Walt Disney’s (DIS) shareholders rejected a compensation plan, which would have increased CEO Bob Iger’s salary significantly despite Iger being considered instrumental in the proposed Fox acquisition. At Tesla (TSLA), CEO Elon Musk’s high remuneration also has been criticized and shareholders will take a decision later this month on how much he gets to take home.
“Greed has increasingly become a virtue among Wall Street bankers and corporate CEOs in the U.S. Nowhere else in the world do CEOs insist on receiving compensation as high compared to what their employees earn.” – Simon Mainwaring
It seems only fair that a CEO earns a package proportionate to the profits of the company for which he or she stands responsible.