Sydbank - AGM 20 March 2020
In general, Sybank is in compliance with the Danish regulations relating to the organization and procedures of the Annual General Meeting.
Pursuant to Sydbank's Articles of Association, the members of the board of directors are appointed by a Shareholders' Committee, the members of which are appointed by the AGM. Under SUB-ITEMS 4.a to 4.ah, it is proposed to (re)appoint 36 members of the Shareholders' Committee. The composition of the Committee is not disclosed (it shall comprise from 60 to 80 members) and the curriculums of the candidates are not available. The appointment of a Shareholders' Committee is not market practice in Denmark, and it is a deviation of the Corporate Governance (CG), which recommends that members of the board of directors are up for election every year at the AGM. As a bare minimum, ECGS considers that companies should strive to comply with local market corporate governance codes. Based on the above, ECGS normally would have recommended opposing the (re)election of all nominees. However, considering that the proxy card does not permit this against vote, it recommends abstention instead.
Under ITEM 5, it is proposed to re-appoint Ernst & Young (EY) as Sydbank's external auditor. EY has been the Group's auditor for 30 consecutive years, which exceeds ECGS guidelines. Therefore, it recommends to vote OPPOSE.
Under ITEM 6.b, the board of directors seeks approval of the remuneration policy. The executive compensation is moderate, and it does not include any variable remuneration schemes. However, ECGS notes that discretionary bonuses are allowed, based on an assessment of long-term results. Although the bonuses are capped at 25% of the base salary, which is reasonable, the payment of discretionary variable remuneration, not linked to predetermined performance metrics, is not in line with ECGS guidelines. Furthermore, ECGS notes that no details have been disclosed regarding any proposed changes to the remuneration policy, Therefore, it recommends OPPOSE.
Sydbank is a financial institution that focuses on banking. Co. has presence in all parts of Denmark as well as in Northern Germany. Co.'s business consists of loans and advances, deposits, guarantees and custody accounts. Co.'s segments include: banking serves all types of retail and corporate clients; asset management comprises its advisory-related income from clients and investment funds; Sydbank markets comprises trading income as well as a share of income from clients with decentral affiliation calculated on the basis of the market price thereof; treasury comprises its return on positions handled by Treasury, including liquidity allocation; and other includes non-recurring items.
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