Infineon Technologies - AGM 25 February 2021
General: The AGM is to be held in the form of a virtual AGM in accordance with the German Law to Mitigate the Consequences of the COVID-19 Pandemic. The physical presence of shareholders or their authorised proxies is not possible. The voting rights may therefore be exercised solely by postal vote or by granting authority to the proxies designated by the Company.
Item 5: KPMG, Munich, is proposed as auditor for the current financial year. While we have no concerns over the ratio of non-audit/audit fees, we note that KPMG has audited the Company since the financial year 1999 which exceeds our maximum acceptable term of office. We therefore recommend opposing the re-election of KPMG as auditor.
Item 6: Approval is sought for the remuneration system for the Management Board which is applicable in part since financial year 2020/2021 and shall be applicable in full as of financial year 2021/2022. Most of the changes in comparison to the previous remuneration system are considered as a significant improvement, mainly due to the abolition of the MTI and the possible granting of special bonuses at the discretion of the Supervisory Board, the introduction of a criteria-based modifier to replace the previous range of discretion by the Supervisory Board to reduce or increase the individual annual bonus, the introduction of non-financial (ESG) targets to the LTI as well as the introduction of share ownership guidelines and malus and clawback provisions. However, we recommend to oppose the approval of the remuneration system due to our concerns over the structure of remuneration that allows for payments potentially being made to Management Board members which exceed the thresholds acceptable by ECGS, a significant increase in the base salary and the potential maximum total remuneration for the CEO, the existence of transitional arrangements to compensate Management Board members for the change to the new remuneration system as well as performance conditions of the LTI which allow for potential vesting at below median performance.
Infineon Technologies is a semiconductor manufacturing company. The Automotive segment designs, develops, manufactures and markets semiconductors for use in automotive applications. The Industrial Power Control segment designs, develops, manufactures and markets semiconductors for the generation, transmission and economy in the use of electrical energy. The Power Management & Multimarket segment designs, develops, manufactures and markets semiconductors for power supplies, mobile devices and mobile phone network infrastructures. The Chip Card & Security segment designs, develops, manufactures and markets semiconductor-based security products for card applications and networked systems.
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