NEW YORK (TheStreet) -- Chipotle (CMG - Get Report) may be raising menu prices and forcing consumers to shell out more for their burrito bowls and guacamole-dolloped burritos, but the Denver-based chain's executive pay practices are getting scrutinized by investors.

At Chipotle's annual shareholder meeting on Thursday, investors gave the company what was referred to as a "wake up call" with regards to its executive compensation practices.

According to Michael Pryce-Jones, the senior policy analyst at CtW Investment Group, Chipotle's executive pay plan, a so-called say-on-pay proposal, received support from just 23% of shareholders, meaning that 77% of shareholders voted against the proposal -- the largest vote against CEO pay so far this year, the organization said.

"We were taken aback by the level of defeat," Pryce-Jones told TheStreet in an interview. "The board said this is a wake-up call for them." CtW Investment works with pension funds associated with Change to Win, a federation of unions representing more than 6 million workers in the U.S. The pension funds have more than $250 billion in assets under management and are "substantial" Chipotle shareholders.

Leading up to the vote, investors and corporate governance firms Institutional Shareholder Services (ISS) and Glass Lewis were urging shareholders to oppose the compensation for Chipotle's unusual co-chief executive structure in which co-founder, chairman and co-CEO, Steve Ells, received a package worth $25.1 million for 2013. Monty Moran, the successful burrito chain's other co-CEO, received a package worth $24.4 million for 2013. The proposal was Proposal B on the meeting's docket -- "An advisory vote to approve the compensation of our executive officers as disclosed in this proxy statement."

Chipotle shares were falling 2.1% to $493.42 on Thursday. The stock is down 7.5% year to date.

"Even Chipotle's share performance cannot justify its pay levels," CtW Investment said in its April 21 letter urging investors to vote no on the proposal. "Chipotle ranks among the 5 worst pay offenders in the Russell 3000, with its CEO pay over the past 3- and 5- year periods vastly outweighing, on a peer relative basis, its total shareholder returns over the same time-frames, according to Equilar, a research service that scores companies on their pay-for-performance."

"By almost any measure Chipotle suffers from a bloated pay structure," the letter said. "Critically, this matters to Chipotle investors not only from both pay-for-performance and corporate governance perspectives, but also from the standpoint of human capital management."

In a press release following the meeting, CtW expressed its satisfaction at the level of opposition, which it said produced "a whopping $285 million in three-year realizable CEO pay."

Institutional investors including the California State Teachers Retirement System (CalSTRS), CalPERS, New York City Pension Funds and the Florida State Board of Administration also voted against the plan, according to CtW.

"With this overwhelming rejection of the pay plan by the company's owners, we expect our board to get to work reining in runaway executive pay at Chipotle," said Dieter Waizenegger, director of CtW Investment Group, said in a release. "Chipotle's unbalanced approach to human capital management poses unacceptable risks to shareholders."

The CtW release pointed out that despite rising investor opposition to Chipotle's executive pay plan over the past two years of 21% in 2012 and 27% in 2013, the Chipotle board had insisted that shareholder opposition to its executive play plan didn't warrant significant changes.

Chipotle spokesman Chris Arnold confirmed the vote's result from the meeting.

"This year, shareholder support for our say-on-pay proposal was about 23% of the shares voted," the company said in a statement. "We take this very seriously. It has always been, and continues to be, a top priority that our compensation programs are driving the creation of shareholder value. We thank our investors for the feedback we have received on this issue, and will continue to engage with our investors as we review our compensation programs that build value for all of our investors." Arnold said that the meeting's full voting results would be filed in an 8-K likely on Friday.

-- Written by Laurie Kulikowski in New York.

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