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    Regulations make pay data tough to ferret out

    (Left to Right) Thomas J. May, Northeast Utilities, Edmund F. “Ted” Kelly, Liberty Mutual, and Richard E. Holbrook, Eastern Bank
    (Left to Right) Thomas J. May, Northeast Utilities, Edmund F. “Ted” Kelly, Liberty Mutual, and Richard E. Holbrook, Eastern Bank

    Northeast Utilities’ refusal to say how much chief executive Thomas J. May earned for three months of 2012 is just the latest example of how companies often hide or obscure the pay of top executives, taking advantage of loopholes in compensation disclosure rules.

    Liberty Mutual relied on a technicality to avoid reporting the $50 million that Edmund F. “Ted” Kelly collected in the year he stepped down as chief executive. Many credit unions and mutual banks, including Digital Federal Credit Union and Eastern Bank, won’t say how much their top executives earn, even though they are owned for the benefit of members and the community.

    And companies have long buried key details in complicated filings on Friday afternoons or right before holidays, when few people are likely to notice. Bank of America, for instance, reported key details about the retirement package for outgoing chairman Charles K. “Chad” Gifford on the afternoon before the Christmas holiday weekend in 2004 — including $16.4 million in severance, free use of the corporate jet for 120 hours ­annually for five years, and the right to buy tickets for up to 15 Red Sox games per year for the rest of his life.


    “Companies work hard to bury this stuff,” said Michelle Leder, founder of, an information service dedicated to finding obscure ­financial information in Securities and Exchange Commission filings and author of the book “Financial Fine Print.” “They don’t make it easy.”

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    Most publicly traded companies, including Northeast Utilities, are required to report how much they paid their CEO and other top executives in reports for investors and securities regulators. But there remain holes in the disclosure rules, despite growing requirements over the years, including some in the massive Dodd-Frank financial overhaul law.

    Critics say Northeast Utilities found one. The utility is refusing to disclose what May earned in the first three months of 2012 because he was still chief executive of NStar before it merged with Northeast Utilities and May became head of the combined company. Since NStar no longer exists as a separate public company, SEC rules don’t require it to disclose that pay.

    The company did report that May earned $4.2 million as chief executive of Northeast Utilities for nine months last year, including his pension and deferred compensation. But other documents suggest he probably earned millions more in 2012; a 2011 filing suggested he would earn $9.3 million in accelerated stock once the merger with Northeast was consummated.

    Northeast Utilities spokesman Michael Durand said the company fully complied with all the SEC requirements and doesn’t believe its handling of the situation is unique.


    For instance, Stanley Black & Decker Inc. of New Britain, Conn., only reported the pay for its new executive chairman, Nolan Archibald, for the months after it completed its merger with Black & Decker (where Archibald was CEO) on March 12, 2010, according to SEC filings.

    And CenturyLink Inc. in Monroe, La., only reported the pay of James E. Ousley, the chief executive of its Savvis division, for half the year — starting with the date it bought Ousley’s company of the same name in 2011.

    Some companies report even less information. Many federal credit unions don’t report any details about how much top executives earn because they are exempt from both SEC requirements covering publicly traded companies and Internal Revenue Service rules governing nonprofits.

    Unlike most nonprofits, federal credit unions are not required to file publicly available tax forms, which contain executive pay information. Even federal credit union regulators ­admitted they typically have no idea how much credit union executives earn.

    Marlborough-based Digital Federal Credit Union is one of the largest credit unions in the country. But it won’t say how much chief executive James Regan earned last year.


    “We are not required to disclose this information,” said credit union spokesman John ­LaHair. “Therefore, for the personal privacy of our employees and their families, we do not.”

    Similarly, mutual banks, which are mutually owned for the benefit of their customers and the community, typically do not reveal how much their top executives make — even to their customers. Boston-based Eastern Bank, the country’s largest mutually owned bank, said only its board of directors and bank regulators know how much chief executive Richard E. Holbrook earns.

    “We do what we are required to do,” Eastern Bank spokesman Andrew Ravens said. “If we ever need to make that information public, we will.”

    Many mutual insurers have tried to keep the information confidential as well — even from the policyholders who theoretically own the company — although they are generally required to file at least some information with state regulators.

    Boston insurance giant Liberty Mutual initially wouldn’t say how much Kelly earned in his final six months as chief executive, noting he was no longer chief executive when the company made a required annual filing with the state. When a Globe reporter asked Kelly at the company’s annual meeting, Kelly estimated he collected around $50 million in that year, 2011 — making him one of the highest paid chief executives in the country.

    After the uproar over Kelly’s pay, the Massachusetts Legislature changed the law last year to require mutual insurers based in Massachusetts, including Liberty Mutual, to either post executive pay details on their public website or mail the information to policyholders.

    But even when the information is publicly reported, it’s not always easy to spot.

    Leder, who runs, said so many companies file embarrassing information just before the weekend that she has a category on her blog titled “Friday Night Dump.” She also noted that companies are not always required to report pay and perks for top executives in the years after they step down, unless they remain on the board.

    Vineeta Anand, who tracks pay for the AFL-CIO labor union, said it is often particularly difficult to calculate how much executives will receive as part of their company pensions and other retirement benefits. The information is sometimes spread out in pieces over different documents, tables, and footnotes.

    “It’s not all in one place and it’s not easy to understand,” Anand said.

    Todd Wallack can be reached at Follow him on Twitter @twallack.