EDP-Energias de Portugal - EGM 19 January 2021
The EGM was called upon a request filed by EDP's significant shareholders China Three Gorges, Oppidum Capital, Senfora, BCP Pension Fund and Sonatrach (jointly holding 34% of the share capital and all represented on the Supervisory Board), to appoint the members of the Executive Board following the resignations of the Group CEO and the CEO of EDP Renováveis, who were suspended by the Public Prosecutor as involved in investigations on alleged corruption.
In item 1, the Remuneration Committee proposes to extend the remuneration policy for the Executive Board members until the next AGM, which will be called to approve a new policy. We regret that EDP does not quantify the targets used to calculate the variable remuneration, and concerns may arise over the high percentage of long-term incentive depending on a qualitative assessment (35%). However, the overall remuneration amounts are reasonable (the annual bonus is capped at 80% of the base salary and the long-term incentive at 120%) and variable components are mostly based on long-term results. Also taking into account that the proposal is exclusively aimed at extending the remuneration policy for few months, we recommend shareholders vote FOR, but we urge the Company to improve disclosure quality and reduce the percentage of LTI depending on qualitative assessments.
In item 2, we recommend shareholders vote FOR the appointment of the members of the Executive Board for the 2021-2023 period.
EDP Energias de Portugal is a utility company engaged as a generator, distributor and supplier of electricity in Portugal, and as an electricity generation company and a gas distributor in the Iberian Peninsula. In addition, Co. is a wind power operator with windfarms for energy generation in the Iberian Peninsula, the U.S., Canada, Brazil, France, Belgium, Italy, Poland and Romania and is engaged in developing wind projects in the U.K. Co. is also engaged in generating solar photovoltaic energy in Portugal, Romania and the U.S, and in Brazil it is engaged as an operator in electricity generation. As of Dec 31 2015, Co. had 9.7 million electricity customers and 1.4 million gas customers.
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