“Companies that have gone through that trial by fire don’t want to go through it again,” says McGurn, the ISS special counsel.

Even Chesapeake Energy, a company perennially in the cross hairs of corporate-governance activists, is bowing to pressure. The company has drawn fire for showering CEO Aubrey McClendon with assorted goodies. In addition to handing him big pay packages — $17.9 million for 2011 — Chesapeake in recent years has spent millions sponsoring the NBA’s Oklahoma City Thunder, which he partially owns, paying him for his collection of antique maps and letting him buy stakes in company wells.

Last year, shareholders of the natural gas producer passed the proposed 2010 pay package but by a low margin, 58 percent. This year, with shareholder pressure mounting, the board has ended some of McClendon’s perks and stripped him of his title as chairman. A lawsuit settlement is forcing him to buy back his $12 million worth of maps.

After losing the chairman job, McClendon issued a statement saying the demotion “reflects our determination to uphold strong corporate governance standards.” Chesapeake will seek shareholder approval for McClendon’s 2011 pay at its annual meeting in June.

So far, Citigroup is the highest-profile company to have its pay package rejected this year. The bank planned to pay CEO Vikram Pandit about $15 million for his work last year, noting that he had returned the company to profitability in 2010 and worked for $1 that year. Shareholders, who watched the stock price plunge 44 percent in 2011 (after adjusting for a reverse stock split) weren’t so forgiving.

It’s usually around January that boards decide how much to pay a CEO for the previous year. Then they inform shareholders and ask for their vote in the spring — usually after the cash portion has already been handed out. For Pandit, that meant he had already received $7 million in salary and cash bonus by the time shareholders voted against his pay.

In a statement, Citigroup said it took the vote seriously and planned to “carefully consider” the input of major shareholders. It hasn’t given more specifics. Richard Parsons, who retired as Citigroup’s chairman after the April annual meeting, as previously planned, said after the vote that the board should have done a better job explaining to shareholders how it determined CEO pay.

Another big change is that more companies are giving themselves the right to take back a top executive’s pay from previous years if they determine that the executive acted inappropriately to inflate the company’s financial results.

Claw backs

The Dodd-Frank overhaul will eventually require public companies to include such broad “claw back” provisions, which will expand on narrowly written rules from a decade ago. But companies aren’t waiting. In a separate study, Equilar found that 84 percent of Fortune 100 companies now include claw backs in their executive pay packages, up from 18 percent in 2006.

Last year, the former CEO of Beazer Homes agreed with regulators, who cited the older claw-back rules, to turn over $6.5 million he had earned when profits were inflated. In February, UBS took back half of the previous year’s bonuses awarded to many investment bankers because of subsequent losses in the unit.

Picking the right mix of incentives is partly just guesswork, and sometimes the results are simply a force of serendipity. Stocks can get swept up in rising or falling markets, so the fortunes of CEOs with well-designed pay packages can reflect luck — good or bad — not just managerial skills.

In February 2009, James Rohr, the head of PNC Financial Services, was granted options that allowed him to buy shares in the future at the then-current price, which had fallen 62 percent in five months on its way to a 17-year low the next month.

The stock has since doubled, and the options, mostly based on hitting certain profit and cost-cutting goals, are worth more than $20 million in paper profit, according to research by GMI Rating, a corporate governance watchdog. If investors had bought PNC stock just before the financial crisis in 2008, they would still be down more than a fifth.

Luck, of course, can cut both ways. Rohr is still waiting to cash in options granted in 2007, valued then at $2.5 million, when the stock was 18 percent higher than it is today.

Some shareholder groups doubt that ever-higher CEO pay, ingrained as it is in the corporate psyche, will ever be refashioned dramatically enough to satisfy shareholders and consumer groups who see the paychecks as too big, too disconnected from performance, and set by wealthy directors who are oblivious to the way that most of their shareholders live.

“I hope we have seen the last of this,” says Rosanna Weaver of the CtW Investment Group, which works on shareholder issues with union-sponsored pension funds and has lobbied against CEO pay packages at a number of companies. “But I would be very surprised, just given what I know of human nature, let alone what I know of the financial markets.”

Still, she’s encouraged by the change that has already been stirred.

“It’s a very big task,” says Rosanna Weaver of the CtW Investment Group, which works on shareholder issues with union-sponsored pension funds and has lobbied against CEO pay packages at a number of companies. “I still believe it is worth trying.”