Bolsas y Mercados Espanoles – AGM 28 April 2020
In item 2, the Company proposes to distribute a final dividend of €0.42 per share for a total aggregate of €1.42 on 2019 results. In view of the recent events related to COVID-19, ECGS recommends that companies postpone decisions regarding dividends to avoid liquidity or financial risks. Therefore, we recommend opposition.
In item 5, shareholders are called to approve changes to the remuneration policy: establishing the possibility to pay an extraordinary variable bonus to the CEO, and to incorporate a new section 12 regarding the aggregate amount to be paid to the Directors. We regret that the Company has not disclosed the performance metrics to be used in measuring the extraordinary bonus and we consider the amount to be excessive (300% of the annual fixed remuneration). Therefore, we recommend opposition.
In item 6, the remuneration policy is subject to the binding approval of shareholders. We regret that the 2018-2020 only depends on the relative TSR, which is heavily influenced by external factors out of the control of the Company, furthermore, the incentive may be paid even in the case that BME ranks below the median of the peer group (40% vesting at ranking 4th out of 6). Hence, we recommend opposition.
In item 8, the Board proposes to acquire own shares up to 10% of the share capital, with a repurchase price of 20% below or above market price, for a period of 5-years. ECGS considers a limit of 110% in the market price of the repurchase price to be sufficient and the Company surprises such limit. Furthermore, we consider the 5 year period of the authorisation to be excessive, albeit in line with the maximum authorised by Spanish legislation. Hence, we recommend that shareholders oppose.
Bolsas y Mercados Espanoles Sociedad Holding de Mercados y Sistemas Financieros (BME) is a company that integrates securities markets and financial systems in Spain. Co. comprises the Madrid, Barcelona, Bilbao and Valencia stock exchanges, MF Mercados Financieros, Iberclear and BME Consulting, as well as several other subsidiaries. Co.'s services include public offerings and trading facilities for equities, derivatives, warrants and fixed income securities. Co. also provides clearing and settlement services, through Iberclear. In addition, Co. is engaged in the distribution of information services and consulting and technology services.
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