The problems of executive compensation at big financial companies like Merrill Lynch (NYSE: MER) and Citigroup (NYSE: C) are obvious. Executives who led their companies into massive losses on risky bets walked away with huge parting gifts, even as shareholders nursed billions in losses. Congress held hearings and financial journalists everywhere cried foul. But corporate governance helps people who help themselves and, for whatever reason, most shareholders have made the inexplicable decision that they don't even want an advisory vote on executive pay.

The Wall Street Journal reports (subscription required) that "At Citigroup Inc., J.P. Morgan Chase & Co., Merrill Lynch & Co. and Morgan Stanley, proposals that would let investors weigh in every year with a nonbinding vote on compensation got an average of just 37% of shareholder votes, according to the latest tallies. Similar proposals in last year's proxy statements for the same companies got 43% support."

How is that even possible? When the problem of pay gone wild is so obvious that even laissez-faire capitalists are saying something is screwed up, why would shareholders reject an opportunity to have their nonbinding voices heard? It just doesn't make any sense at all.

Part of the problem may be that individual investors aren't voting. But I also wonder whether there's some home cooking going on. Are the large institutional shareholders that control the bulk of these companies voting to keep the executive pay gravy train flowing because they have a personal stake in it?

If so, they should remember that their fiduciary duty lies with the investors for whom they own the shares. If regulators want to make themselves useful, they should take a look at this possible conflict of interest.