Proxy advisory firms Glass Lewis and ISS have voiced their support for recommendations to oppose the level of compensation of SCOR CEO Denis Kessler at the next annual general meeting (AGM), although they were split on further proposals to separate the functions of Chairman and CEO.
Last month, investment management firm CIAM urged shareholders to remove Kessler from SCOR’s Board at the AGM on April 26, while allowing him to continue in his role as CEO.
It argued that separating the roles of Chairman and CEO was best industry practice and would eliminate potential conflicts of interest, while also criticising Kessler’s management strategy and his level of compensation.
Glass Lewis and ISS have now weighed in on the issue with recommendations for the AGM that call on shareholders to vote against both the remuneration figure and remuneration policy.
However, whilst Glass Lewis is in favour of CIAM’s call to split the Chairman and CEO functions, thereby removing Kessler from the Board, ISS was opposed to this approach.
CIAM suggested that opposition to its resolution may be motivated by Kessler’s pledge to resign from SCOR if the separation of powers is approved.
“CIAM is disappointed that Denis Kessler applied pressure by saying that he would resign as a way of defence in response to a legitimate request for the separation of his duties,” the firm stated.
“This pressure, which is indicative of Denis Kessler’s attitude to not sharing power, may have intimidated some shareholders but it will also increase their vigilance,” it added. “Change is now inevitable.”
Additionally, Glass Lewis supports the re-election of Lead Director Augustin de Romanet, which was opposed by CIAM, but it highlighted the need for the Board of SCOR to conduct an in-depth review of the remit of the role.
SCOR previously responded to CIAM’s proposals by labelling them “seriously unfounded, inaccurate and misleading statements with the purpose of destabilizing SCOR.”
The reinsurer also claimed that CIAM’s investment in the company is “speculative and short term,” noting that the fund’s 0.94% stake in SCOR had been acquired immediately after Covéa first announced its intentions to take over the company.
CIAM has previously been embroiled in a number of disputes with SCOR and Kessler following the reinsurer’s rejection of an €8.2 billion takeover bid from Covéa last year.
“SCOR is a healthy company, with reliable and talented teams,” CIAM said in its most recent statement. “This campaign for better governance and an independent Chairman is above all constructive and is not aimed at destabilising the company.”
“If, however, Denis Kessler prefers to leave SCOR, the Board should feel comfortable enough to allow the existing management team to take the lead and select the person who is best placed to undertake the role of CEO among the executives,” it continued.
