ETF News

Group of Danone shareholders wants board to clarify strategy at AGM

PARIS, April 7 (Reuters) - A group of Danone shareholders wants each member of the board of directors to present his strategic vision for the French food group at the April 29 annual shareholders meeting.

The request, made by a group of shareholders representing 0.7% of Danone’s capital, was contained in an addendum to the notice of the shareholders meeting published on Wednesday.

It comes after Danone’s former boss Emmanuel Faber was abruptly ousted as chairman and CEO last month, following clashes with some board members over strategy and calls from activist funds for him to resign over the group’s lacklustre returns compared with some rivals.

“The recent governance crisis at Danone has highlighted both the dysfunctions in terms of form and the disagreements in terms of substance that exist within the company’s board of directors,” said the group of shareholders comprising asset managers Phitrust, Ircantec, CAVP, OFI Asset Management and Mirova.

They want each Danone board member to present “his or her strategic vision for the group, in particular covering his or her personal contribution in terms of environmental issues and his or her approach to the organisation of balanced governance.”

In a preliminary comment, the board of Danone said the principle of collegiality in principle prevents the directors from taking individual positions in public and that they are “naturally supportive of all the decisions taken by the board”.

The board, however, said it will answer this item and that Danone will continue to engage in dialogue with shareholders.

The board reiterated its support to a plan dubbed “Local First” - which will entail reorganising Danone around regional hubs rather than brands - and its commitment to Danone’s status as an Entreprise a Mission (purpose-driven company).

It also said the separation of the CEO and Chairman roles was the most suitable governance mode for the company. (Reporting by Dominique Vidalon; Editing by Andrew Cawthorne)