Sanofi-Aventis & Total resist to Say on Pay on chairmen remuneration

The PROXY ACTIVE INVESTORS open fund managed by Phitrust Finance (PARIS) advised by PROXINVEST and held by six French institutional investors had decided to engage for a approval vote for the remuneration of the non executive chairmen. It recently fetched the needed shareholding certificates to table the resolution at SANOFI-AVENTIS, thanks to the support of 16 other investors with 0,58% du capital. Similarily the fund fetched shareholding certificates for 13,8 32 million of TOTAL shares (0.6 % du capital) largely enough to table the same resolution at the next May 15th TOTAL AGM.

The Board SANOFI -AVENTIS met on 16 March and confirmed that the needed threshold was reached but refused to put the resolution on the agenda, arguing that " it is not possible because the French law leaves an “exclusive competence” to the Board on issues of Director remuneration ".

Under French law except in an old decision of a provincial court of appeal here their is no exclusive competence for the Board of Directos on pay in France, the general meeting of shareholders is sovereign : the Board or the shareholders can therefore table anything for a vote of the general meeting of shareholders. Actually the article 225-38 on related party transactions requires any special direct or indirect payment of the company to its directors to be and any change in the amount of attendance fee to Directors is in France subject to an approval resolution.

It would be regrettable and actually counterproductive to force investors to go to court to invite companies to respect the company law at a time of strong public interest for the directors pay. Another sad alternative would be the vote by the French parliament a fifth new bill on the issue…