In item 1, the Board proposes to distribute a dividend of €0.16 per share on 2019 results. Total dividend distribution will amount to €452 million, corresponding to a pay-out ratio of 72.0% on consolidated net income, but it is not covered by free cash flow (€214 million). In view of the financial and economic uncertainties generated by COVID-19, ECGS is in favour of postponing decisions on the dividend, reductions or suspensions that would allow companies to avoid liquidity risks or not generate risk for their survival. In fact, the claims UnipolSai may have to support as result of the pandemic remain unclear and could significantly affect the 2020 results. Therefore, we recommend shareholders to oppose the proposed dividend distribution.

In item 3.a, shareholders are called to a binding vote on the remuneration policy. We regret that the Company has not amended the remuneration policy approved last year, despite the high opposition from minority shareholders (61.1% excluding the controlling shareholder's votes). Overall remuneration amounts are reasonable (the CEO's base salary is 60% of the median of European Insurance companies and total variable remuneration is capped at 225% of the base salary). However, we strongly regret that short-term performance conditions are not disclosed and that discretionary retention bonuses are allowed. Also taking into account that severance payments are capped at 5 years of total compensation, significantly above our guidelines of 2 years, we recommend opposition.

In item 5 (Extraordinary Agenda), the Board proposes to amend the Bylaws by introducing the possibility to assign an additional voting right to shares that have been registered in a "Loyalty Register" kept by the Company for at least 24 months. In our opinion, the possibility to increase the voting rights of registered shareholders is a clear breach of the basic principle of equality of shareholder, and it will only benefit controlling and major shareholders, who will be able to keep the control of the Company even reducing their equity investment. Therefore, we recommend opposition.