Naturgy postponed the AGM initially called on 17 March in light of COVID-19. In this new call, the Company has removed the issue of ordinary bonds and other non-convertible debt securities, has submitted modifications of the AGM Regulations and Bylaws, and proposed the (re-)appointments of four proprietary Directors.

ECGS has concerns over the lack of independence on the Board (42%) and the overrepresentation of major shareholders (50%). Therefore, we recommend that shareholders oppose the (re-)appointments of proprietary Directors in items 6.2 to 6.6.

In item 7, the Company proposes to approve the distribution of €1.37 per share for a total of €1'341 million. In view of the recent events relating to COVID-19, ECGS recommends that companies postpone decisions regarding dividends to avoid liquidity and financial risks. Therefore, we recommend opposition.

In item 9, shareholders are called to a binding vote on the remuneration policy for the 2020-2022 period. We regret that the overall variable remuneration depends more on short- than long-term results, and that the long-term incentive does not depend on multiple or relative performance indicators. Further concerns arise over the Chairman-CEO's fixed remuneration and the shortness of the clawback clause term. Therefore, we recommend opposition.

In item 10, shareholders are called to an advisory vote on the Remuneration Report. We strongly regret that non-executive Directors' fixed fees increased by 38% in 2019 with no clear justifications provided by the Board. Also taking into account our concerns over the very high Chairman-CEO's fixed remuneration, and the structure of variable remuneration schemes, we recommend opposition.