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Annual Accounts

257

Annual Report 2014 BME

28. Proprietary Directors should resign when the shareholders they represent dispose

of their ownership interest in its entirety. If such shareholders reduce their stakes,

thereby losing some of their entitlement to proprietary Directors, the latter’s

number should be reduced accordingly.

See section: A.2, A.3 and C.1.2

29. The Board of Directors should not propose the removal of independent Directors

before the expiry of their tenure as mandated by the Articles of Association, except

where just cause is found by the board, based on a proposal from the Nomination

Committee. In particular, just cause will be presumed when a director is in breach

of his or her fiduciary duties or comes under one of the disqualifying grounds

enumerated in Ministerial Order ECC/461/2013.

The removal of independents may also be proposed when a takeover bid, merger or

similar corporate operation produces changes in the company’s capital structure,

in order to meet the proportionality criterion set out in Recommendation 11.

See section: C.1.2, C.1.9, C.1.19 and C.1.27

30. Companies should establish rules obliging Directors to inform the board of any

circumstance that might harm the organisation’s name or reputation, tendering

their resignation as the case may be, with particular mention of any criminal

charges brought against them and the progress of any subsequent trial.

The moment a director is indicted or tried for any of the crimes stated in article 213

of the

Ley de Sociedades de Capital

(the “Companies Act”), the board should examine

the matter and, in view of the particular circumstances and potential harm to the

company’s name and reputation, decide whether or not he or she should be called

on to resign. The board should also disclose all such determinations in the Annual

Corporate Governance Report.

See section: C.1.42 and C.1.43

31. All Directors should express clear opposition when they feel a proposal submitted

for the board’s approval might damage the corporate interest. In particular, inde-

pendents and other Directors unaffected by the conflict of interest should cha-

llenge any decision that could go against the interests of shareholders lacking board

representation.

When the board makes material or reiterated decisions about which a director has

expressed serious reservations, then he or she must draw the pertinent conclu-

sions. Directors resigning for such causes should set out their reasons in the letter

referred to in the next Recommendation.

The terms of this Recommendation should also apply to the Secretary of the board,

director or otherwise.

Partially complies

Explain

Complies

X

Complies

Explain

X

Partially complies

Explain

Complies

X

Partially complies

Explain

Not applicable

Complies

X