Report
Expert Corporate Governance Service (ECGS)
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Etude de l'AG du 19/12/2017

 Item 1: To remove as a director of the Company, Donald Brydon
Shareholders are asked to approve a shareholder proposal proposed by The Children’s Investment Master Fund (TCI), which owns 5% of the share capital, to remove the Chairman of the Company, Donald Brydon, from the Board. 
The Company’s former CEO, Xavier Rolet, has left the Company.  Primarily due to concerns that his departure was not voluntary, TCI has proposed the removal of the Chairman from the Board. In addition, they are concerned with his track record, and the ‘corporate governance crisis’ in leadership over which he has presided at the Company. 
TCI is concerned that Rolet is being ‘forced out’ of the Company ‘against his will’. TCI points to Rolet’s ‘extraordinary track record’ to suggest that his departure is not in the best interest of the Company. They have requested a clear explanation as to why the CEO is leaving the Company, which has not been provided.  The CFO, David Warren, is currently serving as joint CFO and interim CEO. 
Shareholders should expect clear, transparent communication with the Board over significant governance issues such as the selection and dismissal of a CEO.  That information requested by TCI was not provided to shareholders shows a lack of transparency which is a governance concern in and of itself.  While it is not possible for shareholders to know, at least given current disclosure, the internal situation leading to the departure of the CEO, the lack of clear, transparent leadership and a satisfying response by the Chairman to shareholder inquiries over a significant governance matter is unacceptable.  Even in normal circumstances, the re-election of Donald Brydon to the Board does not meet ECGS policy due to a lack of independence and gender diversity on the Board. Furthermore, we hold the Chairman responsible for the botched execution of the LSE – Deutsche Börse merger when the execution risk was known, and the generous compensation granted to Xavier Rolet. 
 

Underlying
London Stock Exchange Group

London Stock Exchange Group is a global markets infrastructure business based in the United Kingdom. Co's operating segments include: Information Services, which provides a range of information and data products including indexes and benchmarks; Post Trade Services LCH, which provides clearing services through which counterparty risk is mitigated across multiple asset classes; Capital Markets, provides access to capital for domestic and international businesses and electronic platforms for secondary market trading of equities, bonds and derivatives; and Group Technology, which provides secure technologies to customers that require performance at high levels of availability and throughput.

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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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. 

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Expert Corporate Governance Service (ECGS)

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