Report
Expert Corporate Governance Service (ECGS)
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Fresnillo - AGM 21 May 2019

Item 3: Advisory vote on the Remuneration Report

The structure is not weighted to rewarding long term performance as there is no LTI. Furthermore, there are a number of metrics used for the STI for which alignment of pay with performance is difficult to demonstrate as they may be difficult to measure.  Nevertheless, as the quantum is moderate, we recommend shareholders vote in favor.

 Item 16: Approve the Remuneration Policy

There are ongoing concerns with the remuneration policy.  In particular, pay is not aligned with long-term performance as there is no LTIP.  Additionally, no part of the bonus is deferred.  Furthermore, the disclosure surrounding how the bonus metrics are evaluated is unclear, making it difficult to assess the alignment between pay and short-term performance. For these reasons, we recommend shareholders oppose.

Underlying
Fresnillo

Fresnillo is a holding company, engaged in the mining and beneficiation of non-ferrous minerals, and the sale of related production. At Dec 31 2016, Co. had six reportable operating segments: the Fresnillo mine, an underground silver mine; the Saucito mine, an underground silver mine; the CiA(c)nega mine, an underground gold mine; including the San RamA3n satellite mine; the Herradura mine, a surface gold mine; the Soledad-Dipolos mine, a surface gold mine; and the Noche Buena mine, a surface gold mine. In addition, Co. has two development projects, which comprised of: Pyrites Plant, a Leaching plant; and San Julian (phase II), an underground mine, flotation plant and a dynamic leaching plant.

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Proxinvest

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Expert Corporate Governance Service (ECGS)

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