Mediobanca, goodbye to the managers-executives but closes at Del Vecchio on minorities

Mediobanca’s board of directors “assessed compliance with the requirements established by law regarding the request for integration” on the agenda of the shareholders’ meeting presented by the shareholder Delfin. The institute announces it in a note. “In this regard – reads the press release – the Board of Directors believes that the request is legitimate, in compliance with the provisions of the law, and has therefore decided to execute it, integrating the agenda”.

However, Mediobanca’s board of directors notes that “the shareholder Delfin did not promote a preventive engagement with the company by resorting directly to the shareholders, in contrast to the well-established practice in the interaction between shareholders and listed companies”. Piazzetta Cuccia always writes it. The practice provides, the press release adds, that “the shareholder who intends to present requests initiates a constructive and temporally consistent dialogue with the company with the prerogatives of the corporate bodies and the Supervisory Authorities, directly resorting to shareholders only in the event of inaction or non-acceptance “.

Farewell to the managers on the board

So far the questions of form. On the merits, however, Mediobanca’s board of directors agrees with the first proposal put forward by the shareholder Delfin, which will be voted on at the shareholders’ meeting of 28 October, concerning the elimination of the “statutory provisions relating to the presence of managers on the board”. In fact, a note explains, “it reflects the guidelines developed after the last meeting in the light of the discussions held with proxy advisors and institutional investors as part of a process aimed at standardizing the governance of the bank to best practice and the scheduling was therefore envisaged for the 2022 assembly in view of the renewal of the board in 2023 ». The board, therefore, “shares the opportunity to eliminate the statutory constraint, despite the conviction that the presence of managers on the board, which dates back to 1982, has represented and may also in the future represent a strength of the bank’s governance, for the technical contribution to the board debate, favoring the adoption of prudent, independent and informed resolutions “.

Stop the proposal on list voting

The board, on the other hand, found “critical issues” in the second proposal, relating to the amendments to the voting list, because it would risk, among other things, limiting the presence on the board of representatives of institutional investors. The board therefore formulated an alternative proposal to overcome the critical issues and “at the same time achieve the objectives indicated by the shareholder Delfin himself”. Both options will be submitted to the vote of the shareholders at the meeting.

In detail, the board of directors believes that Delfin’s second proposal, “based on the specific nature of Mediobanca’s shareholding structure, may not guarantee the representation of institutional investors” and appears first of all in “contradiction with the evolution of ownership structures”, given that “the composition of the shareholding structure in listed companies, where, as in the case of Mediobanca, there is no controlling shareholder, has for some time recorded an increase in the weight of institutional investors who now represent approximately 50% of Mediobanca’s capital”. Delfin’s request would also be in contradiction with “the ability of the market to monitor the performance of the bank, also asserted by the shareholder Delfin” and with the “declared objective of Delfin to further diversify the composition of the board by increasing the share pertaining to minorities and the number of lists represented “. According to the council, moreover, “the fixed number of four members of minorities, for a board of directors that can be composed of between 9 and 15 members, appears unbalanced”, since it would correspond to a share between 36% and 44 % of directors against an average of Italian banks of less than 20%. The formula proposed for the quotients, moreover, “under certain circumstances, may exclude the appointment of a director possibly proposed by the representatives of institutional investors”, while “the threshold set at 5% of the share capital for appointing a director on the second list of minority reduces the probability that representatives appointed by institutional investors will participate in the board, making it probable, vice versa, that it is an expression of shareholders with significant stakes but not representative of the widespread shareholder base “.