Yahoo CEO's "Over" Pay Puts Spotlight on Performance

Yahoo’s CEO Carol Bartz has been under pressure of late, due to everything from executive turmoil to flat revenue to lack of vision to, perhaps most importantly, a flaccid stock price.

And, as of yesterday, you can add excessive pay to the pile.

That’s because Bartz just topped the list of 25 overpaid CEOs, which is done annually by proxy adviser Glass, Lewis & Co.

A dubious distinction, to say the least.

The San Francisco-based firm pointed to the $39 million Bartz garnered last year from Yahoo (YHOO), which–to be fair–includes both salary and options she has not yet sold.

Still, the huge sum also recently put her atop Fortune magazine’s list of highest-paid women.

Glass Lewis, of course, was using Yahoo’s top exec to make a point:

“Bartz represents a problem we find at many other firms with poor pay-for-performance grades: excessive compensation awarded to executives to encourage them to join or remain with a company.”

Indeed, this big number–however loaded with options based on some level of performance–is one that is sure to draw shareholder ire, due to the fact that the well-paid Bartz is simply not delivering what had been hoped for when she was brought on to shake up Yahoo.

It will be interesting to see if the board of Yahoo–hands down the weakest and most mistake-prone in Silicon Valley–will act in the same way the Microsoft (MSFT) board did with CEO Steve Ballmer.

Although a small thing, especially given how wealthy Ballmer is, the company pointed to the ill-fated venture that was the Kin phone and the slow response to the Apple (AAPL) iPad juggernaut, when giving him only half his maximum bonus recently.

This was despite record revenues at Microsoft, yet still a tiny but encouraging sign that the board has the courage to say: Not good enough.

Will Yahoo’s mousy board members manage to squeak out any such message to Bartz in the months ahead?

Having seen them in action for many years of stumbles now, which has been like watching someone throw himself continually down a flight of stairs, here’s my educated guess: No.