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Candor for Compensation Committees
Fourth Quarter 2011
Corporate Board Member

''This is a failed 'say-on-pay' shareholder derivative action, arising from the Board's unwarranted and excessive spending on executive compensation.''

So begins a recent complaint filed on Sept. 1 against directors of the former R.H. Donnelley, now reorganized as Dex One. They are far from alone in being singled out for potential personal liability.

A week earlier, a similar complaint against Johnson & Johnson's directors accused them of failing ''to follow J&J's executive compensation philosophy and J&J's guiding principles for executive compensation,'' and concluded that ''defendants have breached their duty of loyalty and candor.''

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