Proxy Report - 12/04/2018
We have serious concerns over the corporate governance of Ferrari, as it does not respect the "one share one vote" principle: all shareholders that have registered their shares for more than 3 years are entitled to receive an additional voting right. The major shareholders Exor (22.9% of the share capital and 32.8% of votes) and Mr. Piero Ferrari (9.7% of shares and 15.1% of votes) jointly hold 99.96% of special voting rights.
We also have serious concerns over the composition of the Board, as the Chair and CEO positions are combined, the Senior Non-Executive Director is not independent according to our guidelines, as Chairman and former CEO of a business partner of Ferrari, and there is not a majority of independent members (46% as per our guidelines and 62% according to the Company, which considers as independent Chairmen and former executives of Ferrari's business partners).
For all the above mentioned concerns, we recommend opposing the discharge of Board members (item 2.g), as well as the reappointment of non-independent Directors: Mr. Sergio Marchionne (item 3.a), Mr. John Elkann (item 3.b), Mr. Piero Ferrari (item 3.c), Mr. Louis Camilleri (item 3.e), Mr. Lapo Elkann (item 3.i), Mr. Amedeo Fellisa (item 3.j) and Mr. Adam Keswick (item 3.l).
In item 5, we also recommend that shareholders oppose the authorization to purchase treasury shares, as the authority to buy-back shares is primarily requested to cover the performance share plan. In our opinion the incentive granted to the CEO is excessive (€ 30.7 million on the granting date), it depends on only one performance condition (relative TSR) and may vest even in case of underperformance.
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