Activist investor CIAM has renewed pressure on SCOR over the reinsurer’s decision to move its annual general meeting (AGM) forward due to the coronavirus (COVID-19) outbreak, while restating concerns about the level of executive pay at the company.
In a letter to shareholders, CIAM accused SCOR of ignoring the market practice of postponing shareholder meetings and moving its AGM forward to be just within the limits of French corporate law.
The letter said SCOR is “probably the only company” to have moved its AGM forward, and argued that this action “significantly reduces the time available for shareholders to review the materials published or to engage with the Company in these testing times.”
At the same time, CIAM reignited its attack against SCOR’s “poorly drafted pay policy,” which it says “continues to lavishly reward” the company’s Chair and CEO, Denis Kessler.
CIAM engaged in a prolonged spat with SCOR following the reinsurer’s rejection of an €8.2 billion takeover bid from Covea in 2018.
Catherine Berjal, CEO of CIAM, has been very vocal in her criticism of Kessler’s governance practices, and has previously led a call to have him removed from his combined Chair/CEO position, as well as lowering his pay.
These points were brought up again by CIAM in its latest letter, which highlights a “lack of responsiveness and effort by the Compensation and Nomination Committee to consider shareholder concerns.”
The company says only “cosmetic changes” have been made to SCOR’s remuneration policy despite poor share price performance that pre-dated the COVID-19 crisis.
CIAM further welcomed the news that SCOR will consider a separation of the Chair/CEO roles in 2021, but asked the reinsurer to confirm whether it will appoint an independent Chair next year, and to communicate a clear succession plan for the role of CEO.
“CIAM is fully aware of the challenging times ahead but remains even more convinced that strong governance practices and disclosures will enable companies to navigate the changing landscape and return to delivering value to stakeholders when the uncertainty subsides,” CIAM stated.
“As such, CIAM asks SCOR to disclose further information on its succession plan and publicly clarify its position on the appointment of an independent Chair.”
