In item 4, shareholders are called to a binding vote on the remuneration policy. Remuneration amounts are reasonable (the CEO's fixed remuneration is 40% of the median of European peers and total variable remuneration is capped at 146% of the base salary), but we regret that the Company has not adopted any equity-based variable remuneration or ownership guidelines for executives. We also regret that no relative performance conditions are used to calculate the variable remuneration, and that the KPIs used to calculate the annual bonus are only disclosed ex-post (the Company disclosed the KPIs used to calculate the 2019 bonus, but 2020 KPIs are not disclosed). Also considering that the Remuneration Committee has not taken into account the very high opposition at last year's AGM (30.7% of voting shares and 88.0% excluding the controlling shareholders), we recommend opposition.

For the same reasons, and considering that target and maximum bonuses were paid even if actual results were below or slightly above targets, we also recommend shareholders to oppose the remuneration paid in 2019 (advisory vote in item 5).

In item 7, the AGM is called to appoint the Board of Directors on slates of nominees submitted by shareholders holding, even jointly, at least 1.0% of the share capital. It should be noted that Hera does not respect the "one share - one vote" principle: an additional voting right is assigned to those shareholders that have registered their shares for at least 24 months. The additional voting rights apply only to the appointment of corporate bodies. We recommend shareholders to support the slate of nominees submitted by a group of institutional investors (sub-item 7.3), because all the nominees in the slate are independent from the Company and its shareholders.