TotalEnergies‘ management, when announcing its refusal to place a resolution on the AGM agenda, cited the need to maintain unity of power. This decision follows a proposal by the Ethos Foundation and a coalition of investors to limit the powers of the CEO.
Proposal details
The resolution, supported by shareholders holding 0.62% of the capital, proposed keeping Patrick Pouyanné as Chief Executive Officer, while separating the position of Chairman. The aim was to reduce the risk of conflicts of interest by separating the two main management functions.
Response from the Board of Directors
TotalEnergies’ Board of Directors, which unanimously rejected the proposal, is instead encouraging shareholders to submit points for discussion rather than advisory resolutions. This approach is designed to avoid setting a precedent in corporate governance.
Precedents and comparisons
The situation at TotalEnergies contrasts with other CAC 40 companies, where a dozen or so still combine the two functions. The Publicis group, for example, is also considering a change in its governance that would support this practice.
Legal and institutional implications
TotalEnergies underlines its adherence to French law, refusing to set a precedent for the inclusion of consultative governance resolutions on the agenda of its Annual General Meeting, a move unprecedented in French law according to a company executive.
TotalEnergies’ rejection of this resolution highlights the challenges and debates surrounding the governance of large listed companies, illustrating the tension between the tradition of concentrated power and modern pressures for greater separation of management roles.
