The proposed remuneration policy for Salvatore Ferragamo CEO Marco Gobbetti has received approval from the company’s shareholders, despite criticism from proxy advisers Glass Lewis and Institutional Shareholder Services (ISS). Both advisers recommended voting against the remuneration policy and part of the remuneration report, expressing concern over excessive one-off payments and the overall level of pay in relation to peers and company performance.
Gobbetti, who previously served as the head of Burberry, received nearly €12 million last year, making him one of the highest-paid executives in Italy. The proposed policy for 2023 includes an unchanged fixed remuneration of €2.3 million, a short-term incentive plan with a target payment of €3 million, and a share unit plan with a potential value of €2.5 million.
Despite the criticism from proxy advisers, a majority of shareholders supported the proposed remuneration policy. The Ferragamo family holding, which owns a 54.3% stake in the company, controls the luxury group. This strong family ownership may have influenced the decision of shareholders.
Salvatore Ferragamo has faced challenges due to the COVID-19 pandemic, which arrived as the company was working to revitalize its historic brand. Gobbetti has announced plans to increase investments, revamp stores, and attract younger customers with the aim of doubling revenues to nearly €2.3 billion by 2026. The impact of new designer Maximilian Davis and Gobbetti’s efforts to revive the brand have yet to be fully assessed by analysts.
In the first quarter of this year, Ferragamo saw a decline in sales at constant exchange rates, primarily due to a slowdown in the US market. However, with Gobbetti’s strategic initiatives in place, the company is hopeful for a turnaround in the coming months.
It is important to note that shareholder approval of the remuneration policy does not guarantee its success or effectiveness. The real test will be the ability of the company to achieve its goals and improve its financial performance, ultimately benefiting both the shareholders and the overall sustainability of Salvatore Ferragamo as a luxury goods group.
Links to additional information related to the article:
1. To learn more about Salvatore Ferragamo and its latest news, visit their official website: https://www.ferragamo.com
2. For further insights into executive remuneration policies and guidelines, refer to Glass Lewis’s analysis: https://www.glasslewis.com (if applicable)
