Poor Pierre-Henri Gourgeon
 

First no more free Business Class tickets to Ile Maurice, now this!

From Le Monde:

Bercy refuse de valider la prime de 400 000 euros de l'ex-PDG d'Air France

Edited to add link to a similar article in English (Reuters):

http://www.reuters.com/article/2012/...84S1FU20120530

But I suppose he still has CDG Express as a consolation. ;)

What is funny is that the French government makes all this noise about the 400,000 bonus of PHG but is in no position to refuse it as AFKL is not a State company but a listed firm. Assuming that it is again discussed at the Board level and requires a fresh approval by the Board, the French government could ask its representative to vote against it. But the press release says that they will only be asked to abstain. Why can't they vote no if that is the desire of the State shareholder. This is just a parody of saber rattling.

Very true, brunos.

Because only votes in favour are counted and need to meet the majority of shares. Abstentions are assimilated to vote against.

Frankly, that is not my point. All of this is just symbolic, but symbols are important. If the State wants to send a strong message to the board, especially to the executive directors, their representative should vote against, not abstain.
By the way, who is granting this bonus. Is it AF or AFKL?

But they can't. There is no "no" vote. I wasn't clear when I said that only yes vote are counted, sorry: they're just asking "who is in favour of proposition number XYZ" ? and they look if the number of voting shares is > 50% of shares. Basically, you're handed a card where all the proposal numbers are mentionned, and you check the ones you approve. There is no "no" option to check, they just count the voting bulletin as "yes". You either check or don't do anything (and abstain).

I don't know who's paying but I assume it's the entity that paid his salary as it's part of his work severance package. I agree with you it's all symbolic anyway since it's probable they won't get the money back.

I would say AFKL, as he was CEO of both AFKL & AF and as we are talking about the board meeting and AGM of AFKL. Apparently, the decision on the non-compete clause was approved by the AFKL board in October 2011.

With respect to abstaining or voting against, it looks more like a competition based on words between Moscovici & Montebourg ...

http://lci.tf1.fr/economie/entrepris...n-7323279.html

The first vote should be by the board of directors. It is not about approving the payment; it is a legal obligation the board has: to submit to a vote by the AGM all contracts belonging to a list defined by law, such as a contract between a CEO and the company. Not submitting the contract with the non-compete clause to the AGM would lead to the members of the board of directors being in breach of the Code du Commerce. This vote has probably already taken place, as the list of resolutions must be included in the official notice of the AGM.

The second vote, which is about approving the resolution submitted by the board, is by the AGM. Whether it has any impact is another issue.

Hi Richelieu. Now I am getting utterly confused.
I have never seen a Board of Directors/Conseil d'Administration of a private (meaning not State-owned) company operate as you describe. Actually, it would be against French law of Société Anonyme (and laws in most countries). Directors are individuals and vote as they wish. Each one has one vote whoever he/she "represents" or how he/she was appointed to the board. They do not vote with a proportion of "their" shares.

On the board of AFKL Group, there is one guy appointed by the French State (I think currently J.D. Comolli):
http://www.airfranceklm.com/fr/le-gr...t-dentreprise/
Propositions are formulated by the compensation committee (a group of directors) and discussed by the whole board. But each director has one vote. Of course, decisions are usually reached by consensus.

My question about who proposes/pays this bonus is not unsignificant because Société Air France is a subsidiary of AFKL with a structure inherited from its time a State-owned company. its board is quite different:
http://corporate.airfrance.com/fr/la...dministration/
But it is hard to get a clear picture of the AFKL legal structure.

The newspaper article was referring to an approval by the shareholders' general assembly, not the board. Hence the confusion, I think, but it may be mine. If it was an instruction given to the state-appointed boardmember, then I'd agree that a "no" vote and a "absention" vote would be different (both as a symbol and in effect, since they'd vote with just the need of having more "yes" than "no" among voters].

I think you've misinterpreted or misrepresented what Richelieu is saying.

No one votes "with a proportion of their shares" - if by this you mean someone saying "well, 82% of the shares I represent want to say YES, and 18% of the shares I represent want to say NO".

But the size of the shareholding has to be factored in. If the French government, who apparently own 15.9% of the company, were to abstain, rather than being interpreted as "1 vote - an abstention", it has instead to be weighted as a vote representing fully 15.9% of the issued shares.

So anyone who owns 50.1% or more of a company can always get their way - their single vote will always outrank the (potentially thousands of) other smaller shareholders' votes, who at most only carry a combined weight of 49.9%.

The article states "s'abstenir de valider" rather than "s'abstenir" tout court, viz. "refrain from approving" rather than "abstain."

Well, it seems that, even in the case of a negative vote by the AF/KL AGM, the non-compete clause for PHG cannot be invalidated. It looks as if this is more about posturing by various parties (trade unions, politicians, ...) than about having a real impact.

Maybe they'll give him 5,000 FB miles and a €50 TDC by way of compensation.

I don't understand how a company that was so badly managed over the last few years can agree on giving money against a NCC for the exiting CEO