EUR 500.00 For Business Accounts Only

Mapfre March 08th, 2019

We have concerns over the lack of independent representation on the Board, as it comprises 5 executives, 3 representatives of the controlling shareholder and only 7 independent Directors (47%). Therefore, we recommend that shareholders oppose the re-appointment of the executive Director Mr. Inchausti Pérez in item 5, and the 3 non-executive Directors representing the controlling shareholder Fundación Mapfre (67.7% of the share capital), respectively in item 6, item 7 and item 8.

In item 13, shareholders are called to approve the remuneration policy for the 2019-2021 period (binding vote). We strongly regret that the Board has not proposed any significant changes to the 2016-2018 policy, despite the fact that it was approved by only 28% of voting minority shareholders (excluding the controlling shareholder's votes). The quality of disclosure is low, as the on-target and maximum amount of the annual bonus and the long-term incentive are not disclosed (the policy only states that aggregate variable remuneration paid each year cannot exceed 150% of executives' base salary).

Furthermore, the annual pension contributions for executive Directors are excessive (on aggregate equal to 171% of their base salaries, and 210% of the CEO's base salary), and serious concerns may arise over the possibility to pay discretionary severance payments (as "extraordinary bonus based on the performing during the professional career"). Therefore, we recommend opposition.

In item 14, shareholders are called to an advisory vote on the Annual Remuneration Report, including the policy and the remuneration paid to Directors in 2018. We strongly regret that Mapfre does not disclose the level of achievement of the targets used to calculate the variable remuneration, and concerns may arise over the use of targets that are not challenging enough (maximum bonus paid despite -24.5% in consolidated net income, which is the only KPI disclosed by the Company). Also taking into account our concerns over the remuneration policy (lack of disclosure, excessive pension contributions and discretionary severance payments), we recommend opposition.