In item 6.1, the Board proposes to ratify the appointment of the non-executive Chairman Mr. Jordi Sevilla Segura. Mr. Sevilla Segura does not qualify as independent due to his relationships with the Spanish Government and political institutions. We appreciate that the Board proposes to appoint an external non-executive Chairman, as it announced at the time of the separation of the Chair and CEO positions in 2015. Furthermore, we note that the Board has decided to appoint a Lead Independent Director even if the Chairperson is not executive. Also taking into account Mr. Sevilla Segura's professional background, and the sufficient independent representation on the Board (50% according to our guidelines and 58% according to the Company), we recommend approval.
In item 7.2, shareholders are called to a binding vote on the 2019-2021 remuneration policy for the members of the Board of Directors. We regret that the executive variable remuneration depends more on annual results (the annual bonus may represent up to 71.4% of total variable components at maximum levels of performance), and it is mostly paid in cash. However, we note that the annual performance indicators are defined in line with the progress of the 2014-2019 Strategic Plan, and 25% of the bonus is paid in shares subject to a 5-year retention period, to further align the interests of the executives with those of the shareholders in the long term. Also taking into account that the overall remuneration amounts are reasonable (the CEO's fixed remuneration is 44% lower than the median at European utilities companies and Spanish large non-financial companies, and total variable remuneration is capped at 116% of his base salary on an annual average basis), we recommend approval.
Red Electrica is engaged in the transmission of electrical energy, the operation of the system and the management of the transmission network in the Spanish electricity system. In addition, through its subsidiaries, Co. is engaged in the acquisition, holding and management of foreign securities, co-ordination of international exchanges, provision of telecommunications services for third parties, provision of consultancy, engineering and construction services outside the Spanish electricity system, securing of funds, carrying out of financial transactions and provision of financial services.
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Proxinvest Corporate Governance Rating ® helps investors integrate governance into their investment decision and identify governance risks and opportunities within their portfolio. Proxinvest Corporate Governance Rating ® Service rates European issuers through the analysis of four main themes : Ownership & Shareholder rights, Board & Committees, Audit & Process, Remuneration. Each theme is rated taking into account several comprehensive sub-categories. Our unique two-step process to achieve each rating includes a first step quantitative valuation and a second step qualitative filter...
We reiterate our fair value estimate of EUR 17.80 and our narrow, stable moat trend ratings after Red Electrica released 2018 results in line with expectations. The dividend is set at EUR 0.98, 7% higher than in 2017, in line with our estimates and the business plan, implying a yield of 5.1%, in line with the sector average. We view the shares as overvalued. EBITDA increased by 1.3% to EUR 1.54 billion, the lowest growth rate since 2013, in line with our expectations. Tepid 0.4% revenue growth was offset by an 8% reduction in operating costs excluding staff costs on efficiencies and lower cla...
Proxinvest attire l’attention des actionnaires sur les points suivants : Tout d’abord les rémunérations attribuées au titre de 2018, résolutions Ex Post, rencontrons des recommandations négatives du fait que la société ne communiquent pas les taux d’atteintes de chacun des critères de performance pour la rémunération variable. Concernant les politiques de rémunération, Proxinvest recommande l’approbation des politiques du fait de l’amélioration en termes de transparence et l’inclusion d’un critère lié au RSE.
Rémunérations : La société communique très précisément la nature des critères quantitatifs non financiers, mais elle ne communique ni leurs poids individuels, ni les objectifs qui devaient être atteints, ce qui ne permet pas aux actionnaires d’estimer si les montants attribués au titre de cette part sont bien alignés sur les performances réalisées, et ce alors même que cette part pèse pour 42% du bonus du Directeur Général. Par ailleurs, l’un des critères de performance des actions de performance permet l’acquisition en cas de sous-performance du critère, ce qui n’est pas une pratique acceptab...
In item 3, the AGM is called to appoint the Board of Statutory Auditors on slates of nominees submitted by shareholders holding, even jointly, at least 0.5% of UniCredit's share capital. Two slates of nominees have been submitted, by UniCredit's business partner and shareholder Allianz (1.0%) and a group of institutional investors (1.7%).One of the institutional investors that submitted the slate of nominees is Generali Investments, which is a client of ECGS partners Proxinvest and Frontis Governance. It is important to note that these partners do not provide consulting services to Generali. V...
In item 4, shareholders are called to an advisory vote on the remuneration report. We have serious concerns over the variable remuneration structure, as it exclusively depends on annual results and no limits to the maximum bonus are disclosed. In our opinion, the executive remuneration is not adequately linked to long-term results, hence he recommend opposition. In item 5, the AGM is called to appoint the members of all corporate bodies (Board of Directors, Board of General Meeting and the statutory auditor) in a single item. The members of the Board of Directors and the Board of General Meet...
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