Proxy Advisor ISS advises investors to vote against a new pay package offered to Axa CEO Thomas Buberl, arguing that the insurer did not provide a good enough rationale for a proposal that would include a 14% pay rise.
With Buberl’s mandate as CEO set to resume ahead of a new term lasting until 2026, Axa has proposed a wage policy that it says it will set for this period and bring it “in line” with its biggest rivals in Europe, Allianz, Zurich and Generali.
But ISS said it could not guarantee that the package – which it said would increase the CEO’s maximum annual package by almost a fifth to € 6.9 million – was “appropriate”.
The company stressed that even by Axa’s own metrics, the new pay package could see Buberl take home more than competing CEOs at other insurance companies across Europe.
“Without additional rationale supporting the intended positioning of the CEO’s salary compared to these criteria, especially above their median, it is impossible to ensure that these criteria are fair,” the ISS said.
She also criticized wage policy at other points, including a level of detail about the bonus that she says is lower than the industry’s best practice.
The recommendations of consulting firms are closely examined because of the impact they have on passive investors and large institutions, which often follow suit.
Glass Lewis, another proxy company, said it sees the high pay rises in “skepticism” and that they “should not just be the result of a benchmarking exercise”. But she concluded that Axa provided “appropriate justification” for wage increases.
In a statement, Axa said Buberl’s salary deal “has not changed since his appointment in 2016 and will not change until the end of his new mandate in 2026”, adding: “This means his level of remuneration will only be checked once in 2026. 10 years.”
Axa said the new wage deal reflects “very good financial performance” and the “successful change of the group” under Buberl, which included the purchase Of the expert commercial insurer XL Group in 2018.
But this integration was not without its problems, with the head of the Axa XL being Switched In 2020, at the same time as it lowered a profit target per unit.
Separately, ISS has advised investors to vote for Buberl’s deal approval for fiscal year 2021. Last year it recommended voting against the remuneration report for fiscal year 2020 due to concerns about adjustments made in light of the corona plague.
Axa shareholders urged to vote against CEO’s new pay packet Source link Axa shareholders urged to vote against CEO’s new pay packet