Report
Expert Corporate Governance Service (ECGS)
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Etude de l'AG du 26/04/2017

Item 3: Approve the Remuneration Report. Total variable remuneration exceeds 300% of base salary, the structure is considered unsatisfactory and the quantum is high.

Items 4 - 15: Elect the Board of Directors. There is insufficient independent representation on the Board and on the Audit Committee. The level of independence on the Board is very low (27.3%) compared with the average of 58.5% for the FTSE 100.

On February 28, 2017, LSE refused to divest its Italian bond trading platform, MTS, severely jeopardizing the chances of regulatory blessing for its controversial €29 billion merger with continental rival Deustche Börse. The European Commission had stressed earlier that divesting MTS was essential for protecting French rival Euronext from anticompetitive behaviour. The unexpected success of the Brexit campaign in June 2016 (after the merger announcement but before the EGM), put the future of the merger in doubt as German politicians expressed dismay at placing the new headquarters in London.

At the 2016 EGM convened to approve the merger, we urged LSE shareholders to oppose it citing a low take-out premium (2% higher than the last three months prior to announcement), high regulatory risk and the fact that the Board did not definitively demonstrate that it had explored all strategic options with other potential suitors (notably ICE).

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.

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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