Piaggio & C. – AGM 22 April 2020
In item 2.1 shareholders are called to a binding vote on the remuneration policy, and in item 2.2 to an advisory vote on the remuneration paid in 2019. Overall remuneration amounts are reasonable (the Chairman-CEO's fixed remuneration is in line with market and sector' median and variable remuneration is capped at 30% of the base salary). However, we have serious concerns over the absence of any mechanisms aimed to align the executives' interests with the creation of sustainable value in the long term: the variable remuneration is exclusively based on an annual bonus, there are no deferred bonuses, long-term incentives or clawback clauses. Furthermore, the performance conditions used to calculate the annual bonus are not disclosed, and we note that the Chairman-CEO received the same bonus in the last 3 years, which raise concerns over the discretionary powers of the Board in defining the bonus. Therefore, we recommend opposition.
In item 3, we also recommend shareholders to oppose the authorization to buy-back shares, because it is capped at 20% of the share capital, substantially exceeding ECGS' guidelines of 10%.
Piaggio is a manufacturer of two-wheeler motor vehicles and commercial vehicles. Co.'s product range includes scooters, mopeds and motorcycles from 50cc to 1,400cc marketed under the Piaggio, Vespa, Gilera, Aprilia, Moto Guzzi, Derbi and Scarabeo brands. Co. also operates in the three- and four-wheeler light transport sector with its Ape, Porter and Quargo ranges of commercial vehicles.
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