INVESTEC LIMITED - Results of Annual General Meetings of Investec Limited and Investec plc

Release Date: 08/08/2018 16:30
Code(s): INL INP
 
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Results of Annual General Meetings of Investec Limited and Investec plc

 Investec Limited                                              Investec plc
 Incorporated in the Republic of South Africa                  Incorporated in England and Wales
 Registration number 1925/002833/06                            Registration number 3633621
 JSE ordinary share code: INL                                  LSE share code: INVP
 NSX ordinary share code: IVD                                  JSE share code: INP
 BSE ordinary share code: INVESTEC                             ISIN: GB00B17BBQ50
 ISIN: ZAE000081949

                                                  (jointly “Investec”)

As part of the dual listed company structure, Investec plc and Investec Limited notify both the London Stock
Exchange and the JSE Limited of matters which are required to be disclosed under the Disclosure and
Transparency Rules and the Listing Rules of the United Kingdom Listing Authority (the “UKLA”) and/or the JSE
Listing Requirements.

Accordingly we advise of the following:

                   Results of Annual General Meetings of Investec Limited and Investec plc
                                       (the “Shareholder Meetings”)

The Shareholder Meetings were held on 08 August 2018. As required by the dual listed company structure, all
resolutions were treated as Joint Electorate Actions and were decided on a poll. All resolutions at both meetings
were passed by the required majority. Resolutions 1 to 18, 20 to 27, 32 to 36 and 39 were passed as ordinary
resolutions. Resolutions 28 to 31 and Resolutions 37 and 38 were passed as special resolutions.

The voting results of the Joint Electorate Actions are identical and are given below:

                           Votes For       %        Votes        %       TOTAL        Votes     Witheld     Result
                                                   Against                           cast as
                                                                                        %
                                                                                     issued
                                                                                     capital
      RESOLUTION

      Common Business: Investec plc and Investec Limited

     To re-elect
     Zarina  Bibi
     Mahomed Bassa
1    as a director of     741,328,053   96.82%   24,354,219   3.18%   765,682,272   79.11%    6,423,507    Carried
     Investec plc and
     Investec Limited
      
     To re-elect
     Laurel
     Charmaine
2    Bowden as a           763,517,797   99.72%   2,166,250    0.28%   765,684,047   79.11%    6,421,766    Carried
     director of
     Investec plc and
     Investec Limited

     To re-elect Glynn
     Robert Burger as
3    a director of         753,286,635   98.28%   13,205,958   1.72%   766,492,593   79.19%    5,613,220    Carried
     Investec plc and
     Investec Limited

     To re-elect
     Cheryl Ann
     Carolus as a
4    director of           707,345,509   92.92%   53,928,002   7.08%   761,273,511   78.65%    10,832,300   Carried
     Investec plc and
     Investec Limited
      
     To re-elect
     Peregrine
     Kenneth
     Oughton
5    Crosthwaite as a      707,008,304   92.26%   59,331,463   7.74%   766,339,767   79.17%   5,766,045   Carried
     director of
     Investec plc and
     Investec Limited
     
     To re-elect
     Hendrik Jacobus
     du Toit as a
6    director of           754,165,001   98.39%   12,327,622   1.61%   766,492,623   79.19%   5,613,190   Carried
     Investec plc and
     Investec Limited
     
     To re-elect David
     Friedland as a
7    director of           763,193,590   99.57%   3,299,115    0.43%   766,492,705   79.19%   5,613,107   Carried
     Investec plc and
     Investec Limited

     To re-elect
     Charles Richard
     Jacobs as a
8    director of           730,792,696   95.76%   32,345,958   4.24%   763,138,654   78.84%   8,967,158   Carried
     Investec plc and
     Investec Limited
     
     To re-elect
     Bernard Kantor
9    as a director of     708,810,805   92.48%   57,673,132   7.52%   766,483,937   79.19%   5,621,876   Carried
     Investec plc and
     Investec Limited

     To re-elect Ian
     Robert Kantor as
10   a director of        704,322,600   92.21%   59,501,703   7.79%   763,824,303   78.91%   8,281,474   Carried
     Investec plc and
     Investec Limited

     To re-elect
     Stephen Koseff
11   as a director of     745,291,330   97.23%   21,201,293   2.77%   766,492,623   79.19%   5,613,088   Carried
     Investec plc and
     Investec Limited

     To re-elect Lord
     Malloch-Brown
12   as a director of     763,149,955   99.67%   2,534,092    0.33%   765,684,047   79.11%   6,421,766   Carried
     Investec plc and
     Investec Limited

     To re-elect
     Khumo Lesego
     Shuenyane as a
13   director of          763,193,738   99.67%   2,490,273    0.33%   765,684,011   79.11%   6,421,802   Carried
     Investec plc and
     Investec Limited 
     
     To re-elect Fani
     Titi as a director
14   of Investec plc      737,156,027   96.17%   29,336,585   3.83%   766,492,612   79.19%   5,613,201   Carried
     and Investec
     Limited

     To elect Philip
     Alan Hourquebie
15   as a director of     729,271,764   95.25%   36,377,740   4.75%   765,649,504   79.10%   6,456,187   Carried
     Investec plc and
     Investec Limited

     To approve the
     dual listed
     companies’
     (DLC) directors’
     remuneration
     report (other
16   than the part       621,469,080   81.11%   144,739,822  18.89%   766,208,902   79.16%   5,896,625   Carried
     containing the
     directors’
     remuneration
     policy) for the
     year ended 31
     March 2018
     
     To approve the
     dual listed
     companies’
     (DLC) director’s
17   remuneration       608,897,115   79.47%    157,300,121   20.53%   766,197,236   79.16%   5,908,576  Carried
     policy contained
     in the DLC
     remuneration
     report

     Authority to take
18   action in respect   766,469,782   100.00%     21,633      0.00%    766,491,415   79.19%   5,614,148   Carried
     of the
     resolutions

     Ordinary business: Investec Limited



     To present the
     audited financial
     statements of
     Investec Limited
     for the year
     ended 31 March
     2018, together                                                                                        Non-
19   with the reports                                                                                      voting
     of the directors,
     the auditors, the
     chairman of the
     audit committee
     and the
     chairman of the
     social and ethics
     committee

     To sanction the
     interim dividend
     paid by Investec
     Limited on the
20   ordinary shares     766,262,051   99.97%     220,496      0.03%    766,482,547   79.19%   5,623,144   Carried
     in Investec
     Limited for the
     six-month period
     ended 30
     September 2017

     To sanction the
21   interim dividend    766,281,894   99.97%     200,653      0.03%    766,482,547   79.19%   5,623,144   Carried
     paid on the SA
     DAS share in
     Investec Limited
     for the six-month
     period ended 30
     September 2017

     Subject to the
     passing of
     resolution No 34,
     to declare a final
     dividend on the
22   ordinary shares     766,280,797   99.97%    200,653      0.03%    766,481,450   79.19%   5,624,195   Carried
     and the SA DAS
     share in Investec
     Limited for the
     year ended 31
     March 2018
   
     To reappoint
     Ernst & Young
23   Inc. as joint       659,074,180   86.00%   107,281,890   14.00%   766,356,070   79.18%   5,749,573   Carried
     auditors of
     Investec Limited

     To reappoint
24   KPMG Inc. as        614,886,207   80.50%   148,905,210   19.50%   763,791,417   78.91%   8,314,016   Carried
     joint auditors of
     Investec Limited

     Special business: Investec Limited
     Ordinary resolutions

     Directors’
     authority to issue
25   up to 5% of the      531,779,268   69.38%   234,703,017   30.62%   766,482,285   79.19%   5,623,528   Carried
     unissued
     ordinary shares

     Directors’
     authority to issue
     the unissued
     variable rate,
     cumulative,
     redeemable
26   preference           729,975,218   95.24%   36,502,783    4.76%    766,478,001   79.19%   5,627,766   Carried
     shares and the
     unissued non-
     redeemable,
     non-cumulative,
     non-participating
     preference
     shares

     Directors’
     authority to issue
     the unissued
     special
27   convertible         721,926,057   94.19%   44,547,944    5.81%    766,474,001   79.19%   5,631,766   Carried
     redeemable
     preference
     shares
     
     Special resolutions

     Special
     resolution No 1:
     
28   Directors’          
     authority to
     acquire ordinary    741,516,338   96.80%   24,473,639    3.20%    765,989,977   79.14%   6,115,435   Carried
     shares

     Special
     resolution No 2:
     Directors’
     authority to
     acquire Class
     ILRP2
     redeemable,
     non-participating
     preference
     shares, any
29   other                758,800,598   99.06%    7,178,558    0.94%   765,979,156   79.14%   6,126,487   Carried
     redeemable,
     non-participating
     preference
     shares and
     non-redeemable,
     non-cumulative,
     non-participating
     preference
     shares
     
     Special
30   resolution No 3:     754,137,632   98.39%    12,336,568   1.61%   766,474,200   79.19%   5,631,444   Carried
     Financial
     assistance

     Special
     resolution No 4:
31   Non-executive        761,798,511   99.72%    2,131,599    0.28%   763,930,110   78.93%   8,175,657   Carried
     directors’
     remuneration


     Investec plc
     Ordinary business: Investec plc

     To receive and
     adopt the
     audited financial
     statements of
     Investec plc for
32   the year ended       764,657,939   100.00%    11,030      0.00%   764,668,969   79.00%   7,436,798   Carried
     31 March 2018,
     together with the
     reports of the
     directors and the
     auditors

     To sanction the
     interim dividend
     paid by Investec
33   plc on the           765,579,291   99.88%     913,316     0.12%   766,492,607   79.19%   5,613,080   Carried
     ordinary shares
     in Investec plc
     for the six-month
     period ended 30
     September 2017

     Subject to the
     passing of
     resolution No 22,
     to declare a final
34   dividend on the      766,271,105   99.97%     220,778     0.03%   766,491,883   79.19%   5,613,804   Carried
     ordinary shares
     in Investec plc
     for the year
     ended 31 March
     2018

     To reappoint
     Ernst & Young
     LLP as auditors
     of Investec plc
35   and to authorise     681,014,935   88.85%   85,477,503    11.15%   766,492,438   79.19%   5,613,328   Carried
     the directors of
     Investec plc to
     fix their
     remuneration


     Special business: Investec plc
     Ordinary resolution

     Directors’
36   authority to allot   509,704,557   66.50%   256,786,777   33.50%   766,491,334   79.19%    5,614,433    Carried
     shares and other
     securities


     Special resolutions

     Special
     resolution No 5:
37   Directors’           765,031,866   99.85%    1,112,897    0.15%    766,144,763   79.15%    5,961,003    Carried
     authority to
     purchase
     ordinary shares

     Special
     resolution No 6:
     Directors’
38   authority to         747,391,684   97.55%   18,750,898    2.45%    766,142,582   79.15%    5,963,185    Carried
     purchase
     preference
     shares

     Ordinary resolution

     Political
39   donations            521,135,447   80.94%   122,709,093   19.06%   643,844,540   66.52%   128,261,227   Carried
      

The Boards of Directors of Investec plc and Investec Limited (“the Board”) recognise that effective
communication is integral in building stakeholder value and are committed to providing meaningful, transparent,
timely and accurate financial and non-financial information to the group’s stakeholders. As part of the group’s
stakeholder engagement philosophy and process, the Group Chairman, Senior Independent Director and the
Remuneration Committee Chairman actively engage with UK shareholder representative organisations and the
group’s largest shareholders in South Africa and the UK on an annual basis. This consultation generally includes
the group’s largest 10 shareholders in each country excluding index trackers. This is a process that has been
conducted for over 10 years. These annual engagements have focused largely on governance, remuneration
and related matters, however, they have also provided the group’s shareholders with the opportunity to ask the
Group Chairman, Senior Independent Director and Remuneration Committee Chairman any questions that may
be pertinent at the time. These meetings are in addition to the numerous meetings shareholders would have
with executive management.

Since the group’s AGM in August 2017, the following matters have been extensively discussed with the group’s
largest shareholders:
    - The group’s succession plan as announced on 06 February 2018
    - Strategic priorities in the context of implementing the group’s succession plan
    - Improving returns across the group’s businesses, notably the Specialist Banking businesses
    - Director’s remuneration and the group’s proposed remuneration policy for executive directors for the
         year ending 31 March 2019
    - Audit quality, auditor independence and the rotation of auditors
    - The re-election of KPMG Inc. as one of the group’s joint auditors in South Africa, given the challenges
         experienced by KPMG Inc. in South Africa
    - Independence of non-executive directors and average tenure of the Board.
The Board notes that at today’s AGM certain resolutions have passed with a less than 80% majority, and
provides the following comments in that regard:

Resolution 17: ordinary resolution to approve the dual listed companies remuneration policy

As noted above, the Group Chairman and Remuneration Committee Chairman have extensively engaged with
UK shareholder representative organisations and the group’s largest shareholders on remuneration related
matters over a number of years. Investec’s previous remuneration policy was last voted on by shareholders in
2015 and the group submitted a revised remuneration policy for approval by shareholders at today’s AGM as
required by regulations.

In summary, the group’s revised remuneration policy:
    - Incorporates certain amendments which address the feedback previously received from shareholders
    - Incorporates required regulatory changes
    - Given the management succession announced in February 2018, it focuses on the group’s
       remuneration arrangements within the year of transition.

The Remuneration Committee believes that the proposals it has included in its revised remuneration policy
address a number of matters previously raised by shareholders, notably:
   - Reduction in total compensation levels for executive directors:
           o An approximate 30% reduction in total compensation levels is achieved using the proposed
              new fixed pay and short and long-term measures and metrics applied to 31 March 2018
              performance.
   - Better alignment between pay awards and the performance of Investec:
           o Changes made to the short-term incentive measures and implemented tougher performance
              levels
           o Financial measures performance weightings have been increased to 80% of the total in the
              determination of the short-term incentive
           o In the long-term incentive tougher performance levels have been introduced for certain
              measures
           o The remuneration committee will review the performance measures on an annual basis.
   - Simplification in pay structures and the assessment of executive director performance:
           o Replacing role based allowances for new executive directors with a single fixed pay award of
              cash and shares
           o The short-term measures have been simplified and reduced from nine to six.
   - Treatment of unvested long-term incentive plan awards for departing executive directors:
           o The departing CEO, managing director and group risk and finance director will have their
              unvested long term incentive awards pro-rated to reflect their period of service relative to the
              performance periods of such awards
           o The new policy will clarify that unvested long-term incentive awards will be pro-rated going
              forward.
   - Introduction of a minimum shareholding requirement:
           o Executive directors are required to build and maintain a shareholding of 200% of the cash
              element of fixed remuneration over a reasonable timeframe.

Overall, shareholders have provided the Group Chairman and Remuneration Committee Chairman positive
feedback on the changes made above and believe that the level of disclosure explaining the implementation of
the group’s remuneration policy is detailed and clear. However, some of the group’s shareholders, notably in
South Africa, whilst acknowledging these positive aspects, believe that the overall quantum of pay is too high
relative to South African peers. The Investec Group is an international business, and as such the Remuneration
Committee believes it is appropriate to benchmark executive remuneration against a set of international peers,
including South African competitors. Despite the group’s active engagement on these matters certain of the
group’s shareholders have decided to vote against the remuneration policy.

Resolution 25: ordinary resolution to place 5% of the unissued ordinary share capital in Investec Limited under
the control of the directors and Resolution 36: ordinary resolution: directors’ authority to allot shares and other
securities in Investec plc

The Board is aware of shareholder concerns in relation to the dilutive effect of the issuance of ordinary shares
and will be considering its current practices going forward.
Overall comments on resolutions that passed with majorities of less than 80%
The Board will continue to take into account shareholder feedback in developing and refining its policies and
practices and an update will be provided in the annual report for the period ended 31 March 2019 in respect of
the resolutions which were passed with majorities of less than 80%.

Additional information with respect to the resolution to reappoint KPMG Inc. as one of the group’s joint auditors
in South Africa

The Audit Committee spent a lot of time during the course of the year on matters pertaining to audit quality and
auditor independence and these matters have been explained in detail in the group’s 2018 integrated annual
report.

Regarding the challenges experienced by KPMG Inc. in South Africa:
- A number of processes were initiated to ensure and confirm audit quality;
- Separate audit committee and board meetings were held to consider and conclude on the group’s approach
   to these matters;
- A number of meetings were held with local and international KMPG leadership;
- KPMG International was requested to put additional KPMG international file and technical reviews into
   place;
- Partners from both Ernst & Young LLP and KPMG International attended meetings to outline the enhanced
   and additional cross reviews that had been undertaken;
- Confirmations on independence by both firms were received.

The Board’s decision to retain KPMG Inc. as one of the group’s joint auditors in South Africa was not taken
lightly. The Board is concerned about the failures of KPMG’s internal controls and procedures as acknowledged
by them. Of greater concern is the significant negative impact this has had on the country’s audit profession,
individual lives and the South African economy. Investec is a company that is strongly committed to its core
values which require Investec employees, clients, suppliers and service providers to uphold the highest
standards of ethical behaviour.

The Board requires KPMG International to hold individuals and KPMG Inc. accountable for involvement in the
events that have taken place in South Africa with respect to their firm.

In making the recommendation for re-election of Investec Limited’s and Investec Bank Limited’s auditors, the
Board and Audit Committee have taken into consideration the South African Companies Act and in particular,
the section 90 criteria and requirements for appointing auditors, and the South African Prudential Authority
requirements with respect to joint auditors and mandatory firm rotation. In addition, the need to ensure stability
within the South African financial system and the audit profession at a time of uncertainty and volatility in the
country as a whole is important. The Board expects KPMG International to support KPMG Inc. and restore and
rebuild confidence in KPMG South Africa.

The Board will continue to monitor the situation closely and demand that the quality of work performed by KPMG
for the group is of a high standard.

The Audit Committee Chairman discussed these matters at length with the group’s largest shareholders in South
Africa. Shareholders appreciated the amount of time and work that the Audit Committee had dedicated to these
matters and understood the group’s position in this regard, however, some of them have been guided by their
own internal policies with respect to voting on this resolution.

Other information

As at the date of the AGM, Investec plc’s issued capital consists of 680,447,867 ordinary shares of GBP0.0002
each and Investec Limited’s issued capital consists of 31,441,996 ordinary shares of ZAR0.0002 each.
Investec Limited holds 31,865,535 ordinary shares in Treasury. In accordance with the dual listed companies
structure, the aggregate number of voting rights which may be exercised at the AGM was 967,487,041.

Votes withheld are not votes in law and have not been counted in the calculation of the proportion of votes 'for'
or 'against' a resolution. Proxy appointments which gave discretion to the Chairman have been included in the
'for' total.
Document regarding Resolutions passed at the Shareholder Meetings on 08 August 2018:
- Copies of all resolutions passed as special business at the Shareholder Meetings on 08 August 2018,
   pursuant to Listing Rule 9.6.2, will be submitted to the National Storage Mechanism and will shortly be
   available for inspection at www.hemscott.com/nsm.do.



David Miller                                                   Niki van Wyk
Company Secretary                                              Company Secretary
Investec plc                                                   Investec Limited

Johannesburg and London

Date: 08 August 2018
Sponsor: Investec Bank Limited

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