Report
Expert Corporate Governance Service (ECGS)
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United Utilities, 26 July 2019

Item 3: Approve the Remuneration Report The structure is weighted more heavily towards short-term performance. One of the performance metrics for the LTI is the payment of sustainable dividends, which is not considered appropriate as executives can potentially influence the payout level. The LTI also includes relative TSR as a performance metric. Nevertheless, the quantum is not excessive and even maximum potential amounts are moderate. On balance, we recommend shareholders vote in favor.

Item 4: Approve the Remuneration PolicyThe main concern with the Company's remuneration policy is that pay is not sufficiently weighted toward the long term, which is unchanged in the proposed policy. In addition, although it is welcomed that the Company is not likely to continue using dividend cover as a performance criteria, given that this is not best practice, the lack of disclosure of what exactly will determine 50% of the bonus is unacceptable. We recommend shareholders oppose.

Underlying
United Utilities Group

United Utilities Group is a water company. Through its subsidiary, United Utilities Water Limited, Co. provides water and wastewater services to peoples in the North West of England.

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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Analysts
Expert Corporate Governance Service (ECGS)

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