Expert Corporate Governance Service (ECGS)
EUR 508.94 For Business Accounts Only

Proxy Report - 26/04/2018

General: In February 2018, RWE announced a complex EUR 43bn deal to sell Innogy to E.ON, see section 3.1 for details.

Items 5 and 6: PwC, Frankfurt am Main, is proposed as auditor for the current financial year as well as for the audit-like review of the financial report for the first half of 2018 and of the quarterly reports for 2018. We have no concerns over the ratio of nonaudit/ audit fees. However, we note that PwC has audited the Company since at least the financial year 1997 (no earlier data available) which exceeds our maximum
acceptable term of office. We therefore recommend opposing the re-election of PwC as auditor.

Item 8: Authorisation for a period of five years until 2023 to increase the share capital by up to ~20% of the share capital by issuing shares against contributions in cash and/or in kind. The total shares issued while disapplying preemptive rights under the proposed and all existing authorisations may reach up to 20% of the share capital which exceeds our guidelines according to which we accept a maximum potential dilution of 10%. We recommend opposition.

Item 9: Delphi Unternehmensberatung AG and Deutsche Balaton AG have requested that the 39m preference shares (shares without voting rights) shall be converted to 39m ordinary shares with voting rights at a ratio of 1:1, without additional consideration. The preferential share in profits shall be cancelled. The Articles of Association shall be amended accordingly. A special meeting of preference shareholders shall be convened to adopt a respective resolution as soon as the difference between the weighted average price of RWE ordinary shares and the weighted average price of RWE preference shares in Xetra falls below EUR 2.00 on five consecutive trading days. ECGS strongly supports the "one share - one vote" principle and as such would generally favour the conversion of preference shares into ordinary shares. We consider, however, that the conditions proposed by Delphi and Deutsche Balaton are detrimental to holders of ordinary shares and favour mainly preference shareholders. As only holders of ordinary shares are entitled to vote on this resolution we recommend opposition. We point out, however, that we would support a respective resolution proposed to shareholders of preference shares at a meeting yet to be convened.


RWE is an electricity and gas company. The Conventional Power Generation segment consists of the activities of RWE Power, Essent and RWE npower. The Supply/Distribution Networks Germany segment supplies electricity, gas and heat. The Supply Netherlands/Belgium segment comprises the activities of Essent in the Netherlands. The Supply United Kingdom segment comprises the operations of RWE npower. The Central Eastern and South Eastern European segment contains activities in the Czech Republic, Hungary, Poland, Slovakia, Turkey and Croatia. The Renewables, Upstream Gas & Oil and Trading/Gas Midstream segments include the activities of RWE Innogy, RWE Dea and RWE Supply & Trading, respectively.


Founded in 1995, Proxinvest is an independent proxy firm supporting the engagement and proxy analysis processes of investors. Proxinvest mission is to analyse corporate governance practices and resolutions proposed at general meetings of listed firms.

Proxinvest main services are :

  • ​Proxy reports
  • Definition and monitoring of client customized voting guidelines
  • Corporate Governance Data and Rating
  • Thematic research
  • Engagement support

Proxinvest has been a pioneer and champion of good corporate governance and has grown into a recognised expert in the field.

Proxinvest is independently-owned and only works for investors : Proxinvest does not provide consulting services to the companies it covers, mitigating related risks to its clients and ensuring the independence of our analysis. As a result Proxinvest is able to take a robust, independent, engaged and unconflicted view of the companies in which our clients invest.

As Managing Partner of Expert Corprate Governance Service Ltd (ECGS), Proxinvest has built a large network of corporate governance experts to support clients in corporate governance analysis worldwide. 

Expert Corporate Governance Service (ECGS)

Other Reports on these Companies
Other Reports from Proxinvest
Other Reports from these Analysts

ResearchPool Subscriptions

Get the most out of your insights

Get in touch