Valeo - AGM and EGM 23 May 2019
GOVERNANCE
It is proposed to renew the term of office as director of Jacques Aschenbroich, Chairman and Chief Executive Officer, aged 64. Although ECGS is opposed to the combination of the functions of Chairman of the Board and Chief Executive Officer, the resolution will be supported because the Board has decided to implement the dissociation of functions during the two years following this renewal (resolution 6).
In addition, two new independent directors will join the Board (resolutions 7 and 8).
REMUNERATION
In the context of a very difficult year, the 2018 bonus of Jacques Aschenbroich, Chairman and Chief Executive Officer, fell sharply, even though the qualitative criteria "limit damages". The performance share plan should also be highly impacted or even "not be satisfied". Under these conditions, the link with performance seems real and Jacques Aschenbroich's compensation returns to an acceptable level. Therefore, we recommend the approval of resolution 9, while for 2019, a 15%-increase in fixed remuneration is proposed, which will result in an increase in other types of remuneration. Shareholders are entitled to wonder whether this increase in fixed income is not a way to compensate for the decline in variable compensation caused by poor performance and to increase his pension rights. Therefore, we recommend that shareholders oppose to resolution 10.
Resolution 19 concerns an allocation of performance shares, the analysis of which is based in particular on the description of the performance conditions indicated in the notice of meeting. However, the Board decided, due to very poor results in 2018, to modify the method of calculating the criteria for the 2017 and 2018 plans that were described in the convening notices, which were not subject to shareholder approval. Such a process is likely to disrupt trust between the company and the shareholders and the information provided may then be considered misleading: the company could in the future change the method of calculating the criteria again without the approval of the shareholders.
Valeo is an automotive supplier, partner to automakers worldwide. As an industrial and technology company, Co. focuses on designing, manufacturing and selling components, integrated systems and modules for automobiles and heavy goods vehicles, both on the original equipment and the aftermarket segments. In addition, Co. offers innovative products and systems that contribute to the reduction of CO2 emissions and to the development of intuitive driving to its customers. Co. operates through four business groups: Comfort and Driving Assistance Systems, Powertrain Systems, Thermal Systems, and Visibility Systems.
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