The group ruled by Ernest-Antoine Seillère provides its own interpretation of the six AFEP-MEDEF principles on executive remuneration: Comprehensiveness, Balance, Benchmarking, Consistency, Transparency, Moderation., Wendel’s shareholders must vote on Resolution 4 regarding the termination payment offered to the former CEO Jean Bernard Lafonta. € 2.496.000 for the repurchase of some co-investments initiated by Lafonta himself which might correspond to transparency? In addition, the renewal of his previous contract as an employee allows him to benefit from the social security system as well as from a severance payment. Nevertheless, the latter payment is unsurprisingly defined “on the basis of his last fixed and variable pay as a Managing Director”, i.e. € 955,373. We wonder if this procedure is the application of the policy defined by Balance, Benchmarking, Consistency and Reasonableness!
Resolution 5 is proposing a severance payment of two years’ full pay subject to performance conditions representing around € 2 million to the new CEO Frédéric Lemoine, on top of an extraordinary but undisclosed unemployment insurance (Comprehensiveness and Reasonableness). Resolution 6 is proposing a double severance payment to the CEO Bernard Gautier based on his employee contract as well as on his Managing Director’s arrangements which would result in an additional two years’ remuneration subject to performance conditions. One of the performance conditions is to have received a bonus on the two previous years. Not to worry : in view of a consolidated loss of € 918 million in 2009, a form of solidarity allowed our two top Executives to collect more than the target bonus equivalent to 50% of their fixed pay thanks to their achievement in controlling the debt. Even more recognition is given to Bernard Gautier as he was awarded € 600,000 and € 400,000. Once again it seems like Balance, Benchmarking, Consistency and Reasonableness are clearly driving the remuneration policy!. As far as risks management is concerned, we conclude that self-discipline goes full speed at Wendel! None of the four members of Wendel’s audit committee is independent according to Proxinvest: its Chairman Jean-Marc Janodet is a former top manager of CGIP-Wendel Investissement associated to Ernest-Antoine Seillère’s coups! Two others are members of the Wendel family and the fourth is a Peugeot Managing Director where Ernest Antoine Seillère is also a Director…Besides, the committee cannot meet without inviting a member of the company’s senior management, Patrick Bendahan, Investment manager. The trusted Chairman of the governance committee also attends all meetings.
The company acknowledges that the composition of its audit committee does not fully comply with the recommendation 14.1 of the AFEP-MEDEF code which states that the committee should be composed of at least two thirds of independent members. However, the Board considers that the personal engagement of members, the quality of their work, the regular use of external expertise and the number of meetings balance the arithmetical approach of the committees’ composition.
Another brilliant self-assessment!
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