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Expert Corporate Governance Service (ECGS)
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Atos, 30th April 2019

ADDENDUM (as of 4th April 2019): the company published an addendum this day that changes vesting conditions of options and performance shares. This changes our voting recommendation on item 22, but it does not change our voting recommendation on item 21 and 26.

ITEM 5: the company proposes the payment of an exceptional dividend in kind of 2 Worldline Shares for 5 Atos shares. ECGS supports this proposal.

ITEM 6: the company proposes a non-binding vote on its new strategic plan. It’s the only one in France to do so. We appreciate this initiative.

ITEM 8: the mandate of Thierry Breton, chairman and CEO, is up for reelection. In terms of governance, the outcome is quite negative (decrease of the independence rate, Lead director is no longer independent and counter powers required are still not in place). However, the company’s performance is good and a Deputy CEO was designated in March 2019. For these reason, ECGS supports the reelection of Thierry Breton. However, we urge the company to make efforts regarding its governance.

ITEMS 16, 17 and 26: the company granted performance shares to its Chairman and CEO in July 2018, but as a performance criterion was not met in December, they were cancelled, only less than 6 months after the grant. The main purpose of LTI (to compensate a long-term performance) is not respected, despite repeated criticisms from shareholders. However, we note that in the 2019 remuneration policy, this is no longer an issue, thus we support the new remuneration policy of the Chairman and CEO as it is better than the previous one.
However, this remuneration policy still comprises some major flaws that will be applicable to the new Deputy CEO (mainly the possibility of vesting in case of underperformance). This is not acceptable for a CAC 40 company. Thus we do not support the remuneration policy of the Deputy CEO.

Underlying
Atos SE

Atos is an international information technology services company operating in 52 countries. Co.'s customers are sectors like Public Sector and Utilities, Telecoms and Media, Financial Services, Process Industries and Discrete Manufacturing and Consumer Products and Retail. Co. operates in seven geographical segments: Germany; France; Benelux and The Nordics; U.K. and Ireland; Atos Worldline; Central & Eastern Europe; North America; Iberia; and Other Countries. Co. delivers IT services through the following five segments: Managed Services, Systems Integration, Consulting, Worldline: ePayment Services, and Cloud & Enterprise Software.

Provider
Proxinvest
Proxinvest

Founded in 1995, Proxinvest is an independent proxy firm supporting the engagement and proxy analysis processes of investors. Proxinvest mission is to analyse corporate governance practices and resolutions proposed at general meetings of listed firms.

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Expert Corporate Governance Service (ECGS)

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