Share/Bookmark

Share/Bookmark

SHAREHOLDER SUPPORT is partner of the Expert Corporate Governance Service(ECGS) network. ECGS is a joint venture of independent local market experts which have come together to provide specialist governance assessments and informed proxy voting advice, offering institutions access to unrivalled experience on corporate governance and responsible investment issues. The ECGS network offers coverage of the 500 largest European stocks based on a common framework of governance principles and voting policy.

Recently ECGS expanded its coverage outside Europe as two new partners, GIR (North-America) and SIRIS (Asia/Pacific), joined the network. As a result ECGS will be able to advice institutional investors on more than 1350 companies globally.

For companies outside Belgium, the Netherlands and the Nordic Countries, the underlying research is made by the following partners: Europe: Other ECGS-members are DSW, Ethos and Proxinvest. North America: Groupe Investissement Responsable (GIR), Asia/Pacific: Sustainable Investment Research Consultant (SIRIS).

ECGS: www.ecsg.org

DSW: www.dsw-info.de

Ethos: www.ethosfund.ch

Proxinvest: www.proxinvest.fr

Groupe Investissement Responsible (GIR): www.gir-canada.com

Sustainable Investment Research Consultant (SIRIS): www.siris.com.au

Share/Bookmark

SHAREHOLDER SUPPORT is founded by three partners. Two of the founding fathers are still managing partners while the third is still involved on the background.

As our business and geographic coverage showed a strong growth, we extended our team with senior analysts responsible for their respective regions, one region is a combination of Belgium and the Netherlands and the other region encompasses the Nordic countries. Our team further consists of (research) analysts contributing to the proxy analyses and research.

Our team of experienced and specialized corporate governance experts builds on the strong track record since the start of Shareholder Support. With our complementary backgrounds ranging from consultancy, investment banking and academia, we are able to deliver best-in-class research and analyses to our clients.

Share/Bookmark

SHAREHOLDER SUPPORT is an independent Dutch proxy advisory firm that supports institutional investors in their ongoing dialogue with publicly traded firms.

Since 2002, we have built a strong track record with our research and proxy analyses. With our local expertise and in-depth analyses we are a valuable partner for our clients and the Expert Corporate Governance Service (ECGS) network.

Share/Bookmark

Executive remuneration of Royal Dutch Shell unfavorable from a shareholder perspective

Interview with Nicolai Knop (18 May 2009) in which he expressed his concerns regarding the executive remuneration package of Royal Dutch Shell. A majority of shareholder opposed during the AGM that followed.

Download the interview (Dutch)

Risk management study on major Dutch publicly traded firms

Summary of our 2008 study: “Risk management is a frequently debated topic in the corporate governance world. We observe that the topic receives more and more attention in financial reporting, which is a positive development. However, based on the results of this research we conclude that none of the public companies report on all aspects of risk management. Furthermore, our empirical research has revealed, that disclosure practices regarding risks and internal control systems show a wide diversity regarding:

1. the level of detail
2. the description of the risks and control systems
3. the quality and the scope of the ‘in control’-statement

Download the risk management study (Dutch)

Bonuses should be more transparent

Although the amounts paid under the annual bonus plans are disclosed in the annual reports, it remains very difficult, if not impossible, for shareholders and other stakeholders to get a clear view on the underlying pay for performance relation. In our commentary in the financial newspaper, het Financieele Dagblad, we present seven recommendations for improvement.

Download our commentary (Dutch)

Share/Bookmark

The Impact of Ownership and Board Structure on CEO Compensation in the Netherlands

Abstract: The primary objective of this study is to better understand the impact of ownership and board structures on compensation of Chief Executive Officers (CEOs) in Dutch firms. For our sample of the 75 largest Dutch firms for the period 2006-2008 we find that ownership and board structure variables have significant additional explanatory power to commonly used economic determinants like size, performance and growth opportunities. Outside blockholders, external shareholders who own at least 5% of the shares, significantly lower the levels of total CEO compensation.

Ownership by management board members (excluding the CEO) and supervisory board members are also negatively associated with levels of various forms of CEO compensation. The effects of CEO ownership on compensation levels are, however, less conclusive. In contrast to our predictions, anti-takeover measures also seem to have a monitoring role and have a significant negative relation with CEO compensation. With regard to the board characteristics, the key variable is the size of the supervisory board. Larger or “overcrowded” supervisory boards are less effective which results in higher CEO compensation.

Download our paper (UK)

Relative performance evaluation in the Netherlands

This study presents an overview of the recent developments in relative performance evaluation (RPE) within long term incentive schemes. Its discusses important elements like performance standards, peer group composition and target ranges. Relative performance evaluation within long term incentive plans (LTIPs) has become common practice amongst the largest companies in The Netherlands. Based on an empirical study of the main Dutch stock market indexes, i.e. the AEX, the AMX and the ASCX, for the years 2005-2007, this report describes current practice and assesses the pros and cons of various relative total shareholder return (RTSR) configurations commonly employed.

The report also provides a number of recommendations aimed at improving disclosures on remuneration and helping to improve alignment of incentive schemes and shareholder interests.

link: http://www.toezichtencompliance.nl/publicaties

Share/Bookmark

Proxy voting reports

Our proxy analysis covers the AGM agenda and includes voting recommendations whereby we use the ECGS voting guidelines and local standards. In addition we have additional sections covering key topics like: key figures, share capital structure, corporate governance and directors and board remuneration.

In-depth company report

These reports are used by investors who have an active dialogue with the companies, e.g. visiting AGMs or one-on-one meetings with the board. In order to have an enhanced dialogue these reports build further on the proxy voting reports and includes an in in-depth analysis of amongst others the company’s strategy and performance, risk management, capital structure and board remuneration.

Engagement

Next to our in-depth company reports, we, together with our partners of the ECGS network, can offer a full engagement service for companies in the Eurozone and Switzerland. For more information about this service, please contact us.

Research

The primary objective of our research is to provide a full market overview on a specific topic, which includes a description of current market practices, trends and developments and the identification of best practice examples.

Past research includes topics like executive remuneration, risk management and strategy disclosure in annual reports (reports can be downloaded in the Press & Publications section)

Share/Bookmark

Na de splitsing van TNT zijn de koersen van PostNL en TNT Express hard gedaald. Beide aandelen doen het veel slechter dan de AEX en de koersen van sectorgenoten. De kapitaalmarkt is daarmee aanmerkelijk kritischer over de splitsing dan de aandeelhouders tijdens de laatste aandeelhoudersvergadering van TNT. 

Eenzijdige discussie op AVA gericht op beschermingsconstructie

De vergadering van aandeelhouders heeft immers met grote meerderheid ingestemd met de splitsing, waarbij de discussie zich, mede op instigatie van het invloedrijke Amerikaanse stemadviesbureau ISS, vooral heeft gericht op de beschermingsconstructies van TNT Express na de splitsing. Weliswaar is dit een zeer belangrijk punt om ter discussie te stellen, maar daarmee is de fundamentele discussie omtrent de financiële risico’s en de structuur van de splitsing onberoerd gebleven.

Financiële risico’s en structuur splitsing onderbelicht

TNT Express, de groeibriljant van TNT, heeft weliswaar veel potentie, maar is op de Europese activiteiten na nog niet tot volledige wasdom gekomen. De activiteiten in Azië en de Pacific zijn nog slechts marginaal winstgevend. In Brazilië zijn recente overnames nog niet goed geïntegreerd waardoor zelfs vlak voor de splitsing een winstwaarschuwing moest worden afgegeven.

Een ander belangrijk risico is gelegen in de aanmerkelijke verslechtering van de financiële positie van PostNL en TNT Express na de splitsing. Om te voorkomen dat PostNL met een negatief eigen vermogen achterbleef, is besloten dat PostNL een belang van 29,9% houdt in TNT Express. Geen teken van kracht. Opmerkelijk is overigens dat TNT dit bezwaar zelf ook nog volmondig uitdroeg in haar 2009 jaarverslag. Een jaar later is dit argument van tafel en heeft TNT volledig ingezet op de splitsing. Deze grote omslag biedt op zich zelf al voldoende aanleiding voor een kritische noot.

Weliswaar hebben zowel PostNL als TNT Express een kredietwaardige credit rating, maar de kredietcrisis heeft aangetoond dat credit ratings niet zaligmakend zijn. Opmerkelijk is dat binnen een week na de splitsing de kredietwaardigheid van PostNL al is verlaagd door Standard & Poors van BBB+ naar BBB daarbij verwijzend naar het zwakkere financiële risicoprofiel na de splitsing.

Ook de structuur van de splitsing is onbenoemd gebleven. Bovenstaande risico’s waren wellicht beter te beheersen indien de onderneming was gestart met de afsplitsing van een minderheidsbelang, waarna geleidelijk het belang in Express verder was afgebouwd. Hierover had ten minste een discussie gevoerd kunnen worden, maar die begint alleen door eerst een kritische vraag te stellen over de structuur.

Splitsing strategisch gezien juist, maar uitvoering is ongelukkig

Strategisch gezien is de splitsing de juiste keuze, maar de risico’s en structuur van de splitsing zijn tijdens de laatste aandeelhoudersvergadering onderbelicht gebleven. Te veel aandacht is uitgegaan naar de beschermingsconstructies. De koersontwikkeling van de aandelen na splitsing leert dat een kritischer opstelling op zijn plaats was geweest.

dhr. Nicolai Knop is medeoprichter van Shareholder Support, een Nederlands stemadviesbureau dat tevens deel uit maakt van het European Corporate Governance Service netwerk.

Share/Bookmark