SWEDEN - AP1 has voted against two resolutions by tobacco company Swedish Match - one to raise the company board fees and another to introduce a share option scheme that is not relative and does not contain a value ceiling.
In exercising its shareholder rights, the SEK188.2bn (e20.5bn) Swedish buffer fund announced it had rejected proposals set out by Swedish Match’s board of directors in an extraordinary general meeting held today.
The first proposal was to raise the company board fees by nearly 80%. According to AP1 this was higher than necessary, even though it acknowledged board fees do needed to be increased to attract knowledgeable foreign directors.
Regarding the proposed incentive scheme, AP1 advocated a relative structure in which the value on options was linked to the company’s share price performance relative to its competitors.
The fund said it would also accept an incentive scheme that set a ceiling on the value of share options. However, the Swedish Match board proposed an incentive scheme that was neither of the two and therefore AP1 was forced to vote against the proposal.
On the other hand, the fund supported the company’s proposal that would see the share capital being reduced through the retirement of treasury shares.
This resolution will see the board being authorised to continue repurchasing shares in the company.
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