Proxy adviser ISS is recommending that traders vote towards a proposed new pay package deal for Axa’s chief govt Thomas Buberl, arguing the insurer has not offered a adequate rationale for a suggestion that would come with a 14 per cent wage hike.
With Buberl’s mandate as chief govt up for renewal forward of a brand new time period working till 2026, Axa has proposed a pay coverage that it says will probably be fastened for that interval and can convey it “in line” with its largest European rivals, Allianz, Zurich and Generali.
However ISS mentioned it was not possible to ensure that the package deal — which it mentioned would take the utmost annual package deal of the CEO up by virtually a fifth to €6.9mn — was “applicable”.
The agency highlighted that even by Axa’s personal benchmarking, the brand new pay packet might see Buberl taking dwelling greater than rival CEOs at different insurers throughout Europe.
“With out additional rationale supporting the meant positioning of the CEO’s remuneration in comparison with these benchmarks, particularly above their median, it’s not possible to ensure that these benchmarks are truthful,” ISS mentioned.
It additionally criticised the pay coverage on different factors together with a degree of element concerning the bonus that it mentioned was beneath trade finest observe.
Advisory corporations’ suggestions are intently watched due to the affect they’ve over passive traders and huge establishments, who typically observe their lead.
Glass Lewis, one other proxy agency, mentioned it considered excessive pay rises with “scepticism” and that they “shouldn’t be solely the results of a benchmarking train”. But it surely concluded that Axa had offered “enough justification” for the pay will increase.
In an announcement, Axa mentioned Buberl’s pay deal “has not modified since his appointment in 2016 and won’t change till the top of his new mandate in 2026”, including: “Which means his degree of compensation can have solely been reviewed as soon as in 10 years.”
Axa mentioned the brand new pay deal displays “superb monetary efficiency” and the “profitable transformation of the group” below Buberl, which included the acquisition of specialist business insurer XL Group in 2018.
However that integration has not been with out its issues, with the top of Axa XL being changed in 2020 on the identical time that it downgraded an earnings goal for the unit.
Individually, ISS really helpful traders vote to approve Buberl’s deal for the 2021 monetary 12 months. Final 12 months, it really helpful a vote towards the remuneration report for the 2020 monetary 12 months as a consequence of issues over changes made in mild of the coronavirus pandemic.
