Report
Expert Corporate Governance Service (ECGS)
EUR 500.00 For Business Accounts Only

Fiat Chrysler Automobiles April 12th, 2019

We have serious concerns over FCA's corporate governance, as it does not respect the "one share - one vote" principle, the Board does not have a majority of independent members (58% according to the Company but 42% as per our guidelines), and the controlling shareholder and executive Chairman chairs the Committee responsible for selecting nominees to the Board. Furthermore, since 2017 FCA has been involved in lawsuits concerning alleged violations with respect to the emissions control technology employed by the Company in the US. For all of the above mentioned concerns, we recommend that shareholders oppose the discharge of Board members (item 2.f).

Due to our serious concerns over the composition of the Board, we recommend that shareholders oppose the re-appointment of the executive Chairman Mr. John Elkann (item 3.a), the appointment of the CFO as executive Director in item 3.c (we also note that his appointment will replace an independent Director), and the re-appointment of representatives of the largest shareholder Exor (42% of votes with 29% of shares) Mr. Andrea Agnelli (item 4.c) and Mr. Tiberto Brandolini d'Adda (item 4.d).

We also recommend that shareholders oppose the re-appointment of non-executive Directors Mr. John Abbott (item 4.b) and Mr. Ermenegildo Zegna (item 4.i). Even though they are deemed independent by the Company, they are executives at business partners of subsidiaries and affiliates of FCA Group. Finally, we recommend opposing the re-appointment of the independent Director Ms. Valerie Mars (item 4.f), as we have concerns over her aggregate time commitments.

In items 6.1 and 6.2, we recommend opposing the authorization to increase the share capital by maximum 20% (10% under a general authority and 10% in connection with M&A transactions), as the power to eliminate pre-emptive rights exceeds the ECGS' voting policy limit of 10%. In item 6.3 we also recommend opposing the issue of special voting shares.

Underlying
Fiat Chrysler Automobiles NV

Fiat Chrysler Automobiles is a holding company. Through its subsidiaries, Co. is an international automotive group engaged in designing, engineering, manufacturing, distributing and selling vehicles, components and production systems. Co. has operations in approx. 40 countries and sells its vehicles directly or through distributors and dealers in more than 140 countries. Co. designs, engineers, manufactures, distributes and sells vehicles for the mass market under the Abarth, Alfa Romeo, Chrysler, Dodge, Fiat, Fiat Professional, Jeep, Lancia and Ram brands and the SRT performance vehicle designation.

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.

Proxinvest main services are :

  • ​Proxy reports
  • Definition and monitoring of client customized voting guidelines
  • Corporate Governance Data and Rating
  • Thematic research
  • Engagement support

Proxinvest has been a pioneer and champion of good corporate governance and has grown into a recognised expert in the field.

Proxinvest is independently-owned and only works for investors : Proxinvest does not provide consulting services to the companies it covers, mitigating related risks to its clients and ensuring the independence of our analysis. As a result Proxinvest is able to take a robust, independent, engaged and unconflicted view of the companies in which our clients invest.

As Managing Partner of Expert Corprate Governance Service Ltd (ECGS), Proxinvest has built a large network of corporate governance experts to support clients in corporate governance analysis worldwide. 

Analysts
Expert Corporate Governance Service (ECGS)

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