In item 5.1, the Board proposes to reduce the number of members from 18 to 16, by not fulfilling the vacancies created by the end of the mandate of 2 independent Directors. We strongly regret that the Board size is achieved through a lower independent representation. As we have concerns over the lack of independence (44%) and the excessive representation of major shareholders (50% of Directors with 40.6% of the share capital through a shareholders' agreement) on the Board, we recommend opposition.
Due to our concerns over the composition of the Board, we also recommend that shareholders oppose the re-appointment of Ms. María Teresa Bassons Boncompte (item 5.5) and the appointment of Mr. Marcelino Armenter Vidal (item 5.6), as they represent the largest shareholder Criteria Caixa (40%).
In item 7, the Board proposes to amend the 2018-2020 remuneration policy to reflect the change in the position of a Director, from executive to non-executive, and the approval of a new incentive plan. The overall variable remuneration is reasonable (the bonus is capped at 42% and the long-term incentive at approximately 11% of the CEO's fixed remuneration). However, we note that the CEO's fixed remuneration (€ 2'011'000 in 2018) significantly exceeds the median at large European banks (€ 1'333'731) and at large Spanish banks (€ 1'607'500). We also strongly regret that 50% of the CEO's bonus is based on undisclosed individual conditions, and concerns may arise over the excessive discretionary power of the Board to vary individual bonuses by +/- 25%. Furthermore, the variable remuneration is not sufficiently linked to long-term results, as the annual bonus represents 79% of the total variable remuneration at maximum levels of performance. Therefore, we recommend opposition.Due to the lack of disclosure of the performance conditions used to calculate the annual bonus, and taking into account our concerns over the remuneration policy, we also recommend opposing the Annual Remuneration Report in item 12 (advisory vote).
Caixabank is an investment company based in Spain. Co. is involved in investment portfolio management activities across two areas: Services and Financial Business and Insurance. In the services area, Co. provides investment solutions for companies involved in the infrastructure, energy, services and entertainment sectors. In the financial business and insurance area, Co. is engaged in the investments for international banks, insurance and specialist financial services. Co. focuses most of its banking investments in India, China, the U.S., and Central and Eastern Europe with a particular interest in retail banking. Co. is also involved in the disinvestments activities.
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We are reviewing our Positive credit opinion on CaixaBank as the potential for further improvement in its (good) credit profile now looks limited. Our Positive credit opinion was based on tailwinds from the supportive operating environment in Spain and Portugal and essentially the benefits on the group’s creditworthiness (asset quality, profitability and capital) of the sound performance of both economies given CaixaBank’s strong franchise in both countries. As growth prospects d...
The de-rating visible since end-September 2018 largely integrates the areas of uncertainty hanging over the stock. It is now time to focus on Thales’ strengths and the levers that the integration of Gemalto will offer. Buy, target price of € 130 vs € 126. - ...
Le de-rating visible depuis fin septembre 2018 intègre désormais largement les incertitudes qui entourent le titre. Il est temps de se tourner vers les atouts de Thales et les leviers que va offrir l’intégration de Gemalto. Achat – OC de 130 € vs. 126 €. - - ...
Item 3: Approve the Remuneration ReportThe remuneration structure is satisfactory, though accelerated vesting is possible. Potential and actual total variable remuneration exceed guidelines, but not very much. They are moderate in comparison with UK market practice. Overall, the quantum during the year was not excessive. We recommend shareholders vote in favor.
Item 3: Approve the Remuneration Report The structure is weighted more heavily towards short-term performance. One of the performance metrics for the LTI is the payment of sustainable dividends, which is not considered appropriate as executives can potentially influence the payout level. The LTI also includes relative TSR as a performance metric. Nevertheless, the quantum is not excessive and even maximum potential amounts are moderate. On balance, we recommend shareholders vote in favor. Item 4: Approve the Remuneration PolicyThe main concern with the Company's remuneration policy is that pa...
Item 2: Approve the Remuneration ReportThe remuneration structure is unsatisfactory. The main concern at the Company is that the potential maximum incentive pay including the bonus, matching shares on the deferred portion of the bonus and the LTI amounts to 1000% of base salary, which is considered grossly excessive. Actual incentive pay during the year was1.6 times the ECGS limit. Furthermore, variable remuneration is overly reliant on a single performance metric, benchmark profit before tax. A second performance criteria will be used in the coming year. We note that the Company has adjusted ...
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