4. Marco Teórico
4.3 Elementos Matemáticos Relativos a la Proporcionalidad entre Magnitudes
IV.1.1 The company's deals with equityholders having a qualified holding or with entities having any relations with them,
under the terms of Article 20 of the Securities Code, shall be carried on at arm's length. Complied III.11 and III.12 IV.1.2 Company deals of significant importance between equityholders with a qualified holding or with entities linked with
them with them, under the Article 20 of the Securities Code, shall be subject to the prior opinion of the supervisory body. The procedures and criteria required to define the relevant level of significance of such deals and the other conditions shall be
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0.3 Overall assessment of the degree of adoption of groups of recommendations
interrelated by their theme.
Mota-Engil considers that, although it does not comply fully with the CMVM recommendations, as fully justified in the following chapters, the degree of their adoption is quite ample and complete.
0.4 Explanation of discrepancies between the company’s governance practices and the
CMvM recommendations:
I.4.1 Companies shall not fix a quorum for resolutions greater than provided for by law.
The Mota-Engil articles of association stipulate that for the general meeting to meet and adopt resolutions on first call equityholders must be present or represented who hold at least half of the issued capital. Since Article 383 of the Companies Code is less restrictive, this recommendation is not complied with. The understanding of Mota-Engil is that this model is the one that best defends corporate interests.
II.1.1.5 Management and supervisory bodies shall have working regulations that shall be divulged via the company’s Internet site.
The Mota-Engil, SGPS, SA, management and supervisory bodies have in-house working regulations, though they are not published on the company’s Internet site and are not available for consultation. The understanding of Mota-Engil is that the regulations go beyond aspects of the mere working of the bodies and contain confidential information, for which reason they are not available to the public.
II.1.2.2 Non-executive directors shall include an adequate number of independent directors, taking into account the size of the company and its equityholder structure, though not less than one fourth of the total number of directors.
Of the eight non-executive members of the Mota-Engil, SGPS, SA, Board of Directors only three are qualified as independent directors, and these account for 20% of the total number of members of the management body. Although this recommendation is not complied with, Mota-Engil, taking into account the size of the company and its equityholder structure, considers that the number of independent directors is adequate.
II.1.3.2 The selection process of candidates for non-executive directorship shall be so conceived as to prevent interference by executive directors.
Taking the company’s size and its equityholder structure into account no need is seen for a formal process of selection of candidates for non-executive directorship. Candidates for non-executive directorships are elected by the General Meeting. At the elective general meetings that have been held, the names included in the lists for election of corporate officers, particularly with regard to the management body and its non-executive members, have been proposed by the equityholders constituting the signatories thereof, and the executive directors do not take part the non-executive director selection process.
II.1.5.1 remuneration of the members of the management body shall be so structured as to allow the alignment of their interests with those of the company.
The recommendation is not complied with insofar as the following indents are concerned. Notwithstanding this non-compliance, Mota-Engil considers that the objective of alignment of the interests of the members of the management body with those of the company have not been called into question.
(ii) the variable component of the remuneration shall be generally reasonable in relation to the fixed component of the remuneration and maximum limits shall be fixed for all components.
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terms, which cannot exceed five per cent of the year’s profit, the Remuneration Committee considers that the variable component attributed to the members of the Executive Committee have been reasonable, taken as a whole, in relation to the fixed component of the remuneration.(iii) a significant part of the variable remuneration shall be deferred for a period of no less than three years and its payment shall depend on the continuity of the good performance of the company over that period.
There is no deferral of the payment of the variable remuneration and the Remuneration Committee seeks to structure the remuneration of the members of the management body to allow the continuation of the good performance of the company in the long term.
(iv) members of the management body shall not close contracts either with the company or with third parties, the effect of which is to mitigate the risk inherent in the variability of the remuneration fixed for them by the company.
There is no mechanism preventing the executive directors from closing contracts calling into question the reason for the variable remuneration. Nevertheless, the Remuneration Committee always takes this factor into consideration in the criteria used to determine the variable remuneration.
(vii) adequate legal instruments shall be established so that the compensation determined for any form of dismissal without due causes of a director is not paid if the dismissal or termination by agreement is dues to the inadequate performance of such a director.
There are no instruments, other than those enshrined the law that allow non-payment of compensation in the event of inadequate performance of the director in cases of dismissal with due cause or termination by agreement.
(viii) the remuneration of the non-executive members of the management body shall include no component the amount of which is dependent on the performance or value of the company.
The remuneration of non-executive directors includes variable components. Mota-Engil’s understanding is that, besides rewarding the long-term strategy undertaken by the entire Board of Directors, including the non-executive directors, this does not disparage their non-executive function.
II.2.5 The company shall explain its rotation policy in respect the responsibilities of the members of the board of directors, particularly the member responsible for financial matters, and shall provide information thereon in the annual report on corporate governance.
There is no rotation policy for the Posts of the members of the Board of Directors (Executive Committee), in particular for the director responsible for financial matters. Mota-Engil’s understanding is that a rigid, abstract job-rotation policy would not serve its best interests. Therefore, the posts are decided and assigned by the Executive Committee at the start of the term of office in keeping with the capabilities, qualifications and professional experience of each member, It is not believed that all directors are able to perform every function with the same capabilities and performance.
II.4.6 The internal audit services and those that ensure compliance with the rules applied to the company (compliance services) shall report functionally to the audit committee, the general and supervisory board or, in the case of companies that adopt the latin model, an independent director or board of auditors, regardless of the hierarchic relationship between such services and the company’s executive management.
The internal audit services (Audit & Risk Office) report functionally to the Investment, Audit and Risk Committee. This committee normally comprises three permanent members (a non-executive director, the chairman, an
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independent non-executive director and the CFO). Although it does not report functionally to an independent director or to the Board of Auditors, it is considered that the independence of this office in respect of the executive committee is ensured.
II.5.1 save for reasons to do with the small size of the company, the board of directors and the general and supervisory board, depending on the model adopted, shall create such committees as may be seen to be necessary to: i) ensure competent, independent assessment of the performance of the executive directors and to assess its own overall performance as well as that of the various existing committees; ii) reflect on the governance system adopted, verifying its efficacy and proposing to the proper bodies those measures to be implemented with a view to their improvement; and iii) ensure timely identification of potential candidates having the necessary profile to perform
the duties of a director.
The recommended committees were not set up in that they were not seen to be necessary.
II.5.2 The members of the remuneration committee or similar body shall be independent with regard to the members of the management body and shall include at least one member having knowledge of and experience in remuneration-policy matters.
António Manuel Queirós Vasconcelos da Mota (chairman and non-executive member of the Board of Directors) and Maria Teresa Queirós Vasconcelos Mota Neves da Costa (non-executive member of the Board of Directors ) are members of the Remuneration Committee, having been elected to the position by the General meeting at the proposal of the majority equityholder Mota Gestão e Participações, SGPS, SA. Their participation in the Remuneration Committee corresponds solely to representation of the equityholder’s interest, and they intervene in this capacity and not in that of members of the management body. To ensure their independence in the performance of these duties, these members do not take party in any discussion of adoption of resolutions in which there is or could be a conflict of interests, particularly with regard to fixing their own remuneration as members of the management body. It is considered that, as a result of their curricula and professional careers (detailed in point II.18), the three members of the Remuneration Committee have knowledge and experience in the matter of remuneration policy. Additionally, as and where necessary, the Remuneration Committee is helped by in-house or external specialists to support their decisions in the matter of the remuneration policy.
III.1.3 Companies shall promote rotation of the auditor at the end of two or three terms of office, depending on whether the term is of four or three years. Grounds shall be provided for their continuation beyond this period in a specific opinion issued by the supervisory body, expressly weighing the auditor’s conditions of independence and the advantages and costs of his replacement.
MOTA-ENGIL has neither defined nor implemented any policy of rotation of the external auditor. The Board of Directors considers that replacement of the partner responsible for the audit services every seven years (mandatory by law) in conjunction with the powers assigned to the Board of Auditors is sufficient to ensure the independence of the external auditor.
The maintenance of the auditor is based on the specific opinion of the supervisory body, expressly weighing the auditor’s conditions of independence and the advantages and costs of his replacement.
III.1.5 The company shall not hire the external auditor or any entity in a participating relationship with it or that is part of the same network, to perform services other that auditing services. If there are reasons to hire such services - which must be approved by the supervisory body and explained in its annual report on Corporate Governance - they must not exceed more than 30% of the total value of services provided to the company.
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Even had the external auditor been hired to provide services other than auditing services of a value greater than 30% of the total value of the services provided to the company, as seen in point III.17 of this report, Mota-Engil believes that, in view of the existing mechanisms, its independence is ensured.
Iv.1.2 Company deals of significant importance between equityholders with a qualified holding or with entities linked with them, under the Article 20 of the securities Code, shall be subject to the prior opinion of the supervisory body. This body shall establish the procedures and criteria required to define the relevant level of significance of such deals and the other terms of its intervention.
Deals between the company and owners of qualified holdings or entities in any relationship therewith are appraised solely by the Executive Committee, on the basis of analysis and technical opinions issued by the Investment, Audit and Risk Committee (specialised committee). No procedures or criteria have been established in respect of intervention by the supervisory body. It should be mentioned, however, that transactions between directors of Mota-Engil, or with companies in a controlling or group relationship with the one of which the contracting party is a director, regardless of their value, are subject to the prior authorisation of the relevant Board of Directors and to the favourable opinion of the respective supervisory body, under Article 397 of the Companies Code.
I.1 Identification of the members of the Board of the General Meeting.
Chairman: Luís Neiva Santos Secretary: Rodrigo Neiva Santos The human and logistic resources appropriate to the needs of the Chairman of the Board of the General Meeting are provided, particularly through the support given by the services of the Mota-Engil, SGPS, SA, Legal Office. This support is deemed adequate to the company’s size and economic situation. Minutes of General Meetings are available on the company’s Internet site, as are the attendance lists, the agendas and the resolutions adopted in respect of the meetings held during the past 3 years.I.2 Indication of the beginning and end of the respective terms of office.
The start and end dates of the members of the board of the General Meeting are 2010 and 2013 respectively.
I.3 Indication of the remuneration of the chairman of the Board of the General Meeting.
During 2010, the Chairman of the Board of the General Meeting earned €12,500 (€1,072 per month).I.4 Indication of the period during which shares are deposited or blocked in order to
take part in a General Meeting.
As a result of the publication of Decree-Law 49/2010 of May 19, this recommendation is no longer applicable.
I.5 Indication of the rules applicable to the blockage of shares in the event of
suspension of the General Meeting.
As a result of the publication of Decree-Law 49/2010 of May 19, this recommendation is no longer applicable.
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I.6 Number of shares corresponding to one vote.
In accordance with the Mota-Engil articles of association, each share corresponds to one vote, thus ensuring the necessary proportionality between holding equity capital and voting right.
I.7 Indication of the bye-law rules that provide for shares that do not grant voting
rights or establish that voting rights above a certain number are not counted when
cast by a single equityholder or equityholders related with that equityholder.
Though the articles of association provides the possibility of the company to issue preference shares without voting rights, there is currently no such class of shares.
I.8 Existence of statutory rules on the exercise of voting rights, on the quorum required
to hold meetings and adopt resolutions or adopt resolutions, or on systems to detach
patrimonial rights.
In accordance with Article 23 of the company’s articles of association, for the General Meeting to be held and to adopt resolutions on first call, equityholders must be present or represented holding shares corresponding to more than fifty per cent of the issued capital.
I.9 Existence of statutory rules on the exercise of voting rights by correspondence.
The statutory rules on the exercise of voting rights by correspondence are stipulated in Article 22 of the company’s articles of association. In accordance with this article, equityholders may vote by correspondence in respect of each and every matter, there being no restriction in this connection.I.10 Provision of a form for the exercise of voting rights by correspondence.
This form may be obtained from the Capital Market Relations Division (João Vermelho - e-mail: [email protected]).
I.11 requirement as to the period between reception of the postal ballot and the date
on which the general meeting is held.
Postal ballots shall be considered only if received at the company’s registered office at least three days before the date of the General Meeting.
I.12 Exercise of voting rights using electronic means.
Exercise of voting rights using electronic means is not yet possible. To this date the company has received no request for or expression of interest in the provision of these means from equityholders or investors.
I.13 Ability of equityholders to access excerpts of the minutes of general meetings on
the company’s Internet site during a period of five days after the general meeting.
The company’s shareholders are able to access via the Internet Site (www.mota-engil.pt) the excerpts of the minutes of general meetings, which are divulged within 5 days of the meeting.I.14 Existence of an historic record, on the company’s Internet site, of the resolutions
adopted at the company’s general meetings, the equity capital represented and the
results of the balloting in respect of the preceding 3 years.
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Via its Internet site (www.mota-engil.pt) the company provides information on resolutions adopted at the company’s general meetings in respect of the past three years, as well as on the equity capital represented and on the balloting results.
I.15 Indication of the representatives of the remuneration Committee present at
general meetings.
The Remuneration Committee has been represented by all its members at the Annual General Meetings.
I.16 Information on the intervention of the general meeting in respect of the company’s
remuneration policy and of the assessment of the performance of the members of the
management body.
The General Meeting is charged with appointing a Remuneration Committee, which will define a remuneration policy for the corporate officers, and other senior managers, promoting, from a medium and long-term viewpoint, the alignment of their interests with those of the company. The declaration on the policy of remuneration of the management and supervisory bodies will be submitted to the General Meeting as required under Act 28/2009, of June 19.