The main objectives regarding corporate governance matters set by Red Eléctrica are:
- Progress in the commitments that the Company has made to its shareholders, particularly institutional investors, in order to consolidate a permanent relationship that will align the interests of the Company with those of its shareholders.
- Adoption of measures to counterbalance the powers and responsibilities within the heart of the Board of Directors.
- Improvement of the remuneration structure of the Board of Directors and of the information and transparency of the remuneration of the Board and the CEO, in the annual report on remuneration of Board members, based on international best practices of corporate governance.
- External audit of the management processes of the Ordinary General Shareholders’ Meeting.
The references used by Red Eléctrica are the international best practices of corporate governance: policies, practices and recommendations established by foreign institutional investors, by proxy advisors, and international organisations such as the OECD (Organisation for Economic Co-operation and Development). The constant implementation of said practices is a priority objective of the Company.
The basic tools used are the annual evaluation of the Board (supported by an external advisor in recent years), a Corporate Governance improvement programme implemented with advice from specialist consultants and a visits programme for institutional investors and proxy advisors which takes place annually.
Participation in forums and specialised organisations is another tool used with increasing frequency.
The Board of Directors is composed of 12 members (1 Chairman, 1 CEO, 3 external nominees and 7 independent directors).
The Board of Director, supported by the tasks performed by the Audit Committee and the Appointments and Remuneration Committee, governs and represents the Company.
The creation of the position of Lead Independent Director strengthens the role of the independent directors on the Board.
The essential duties and responsibilities of the Appointments and Remuneration Committee are the following:
- Report – and propose, in the case of the independent directors – in advance, all the proposals that the Board of Directors put forth to the General Shareholders’ Meeting for the appointment or removal of board members.
- Propose to the Board of Directors the remuneration policy of the members of the Board and the senior managers of the Company, and ensure its compliance.
- Undertake the duties regarding information, supervision and proposal in corporate governance matters that are determined by the Board of Directors.
- The Committee is composed of three external directors, 2 of them being independent directors, and is chaired by an independent director.
Currently, the shareholding structure of the Company consists of a 20% stake held by SEPI, with the remaining 80% being free float.
Minority shareholders are represented on the Board of Directors by the independent directors. Of the eleven members of the Board, seven are independent directors. In addition, the Board Committees are composed mostly of and chaired by independent directors.
The primary responsibility of the Lead Independent Director is to organise the possible common positions of the independent directors and serve as a dialogue channel of said positions to the Chairman of the Board of Directors, the Board and its Committees This figure is endowed with extensive competencies that act as counterbalance to those attributed to the Chairman of the Board of Directors.
The Board of Directors has undertaken the best international recommendations on gender diversity. Four of its members (33%), representing 40% of the Company's external directors, are women. This puts the Company at the forefront of the IBEX 35 Index. Annually, a report on gender diversity is prepared and approved by the Board of Directors, and is made available on the corporate website.
The remuneration policy of the Board is based on the following principles:
- Transparency. The remuneration structures and elements most demanded by investors are included, aiming to further the objective of achieving maximum transparency.
- Linked to the Company’s performance, with continuous reduction in its weighting in relation to Company results.
- Linked to actual dedication.
- Aligned with the long-term interests of both the Company and the Shareholders, aiming to gradually incorporate the criteria and parameters required under international standards.
- Acting as an incentive, but without conditioning Directors’ independence (particularly in the case of Independent Directors).
- Aligned with the common practices of listed companies.
- Submitted annually to the General Shareholders’ Meeting for approval.