#Italy #Rome #Wyser-Pratte #Leonardo SpA #AGM vote

Demands for Independent Investigation into Leonardo SpA AGM Vote

In a startling turn of events during the recent Annual General Meeting (AGM) of Leonardo SpA, renowned shareholder activist, Guy Wyser-Pratte, has raised serious concerns regarding the transparency and conduct of the meeting. With over half a century of experience advocating for shareholder rights in multiple countries including the United States and various European nations, Wyser-Pratte has never encountered a situation quite like this.

The AGM was marked by severe restrictions, limiting shareholder participation and engagement. Shareholders were not permitted to converse, ask questions, or interact with the board. Instead, the meeting was tightly controlled, with a duration of just approximately 60 minutes, and the proceedings were conducted solely through a proxyholder selected by the company. Wyser-Pratte criticized these practices, asserting that the affair resembled more of a scripted formality than a genuine meeting of shareholders intended to foster open dialogue and discussion.

Adding to the discontent was a technical glitch that disrupted remote access for board members at the precise moment the meeting commenced. This glitch left many questioning the integrity of the event, especially when Leonardo's own staff could not guarantee a stable connection. The timing of this incident, occurring as the closed-door meeting initiated, prompted Wyser-Pratte to label the failure as highly suspicious.

The Scrutiny of Results

The results of the vote were astonishingly narrow, with the government-backed slate of candidates prevailing with just 50.097% of the votes compared to 49.481% for the opposing, institutional investor-supported slate. This razor-thin margin of victory strongly suggests a need for scrutiny, leading Wyser-Pratte to call for an independent investigation into the counting of the votes.

Notably, two major proxy advisory firms, Institutional Shareholder Services (ISS) and Glass Lewis, had previously recommended opposing the government slate, advocating instead for the candidates proposed by Assogestioni, representing the interests of Italy's institutional investors. The opposing slate comprised independent candidates vetted against stringent governance criteria, thereby reflecting the broader market's sentiment, including that of pension funds and asset managers who prioritize long-term interests.

Wyser-Pratte expressed his dismay at how a government wielding only a third of the company's ownership succeeded in passing its agenda against the wishes of a coalition representing a far larger array of shareholders. This position poses significant questions regarding the governance practices at Leonardo SpA and the implications for shareholders’ rights.

A Warning for Investors

The events at the AGM signify more than a governance failure; they send a concerning message about Italy's investment climate. As the European Union pursues efforts to attract foreign investments for critical areas such as defense and energy, such incidents threaten to undermine investor confidence. The perceived lack of respect for fair governance principles, resulting in closed meetings and silenced shareholders, suggests fundamental flaws in corporate accountability that cannot be overlooked by global investors.

In context, critics argue that Italy's behavior is reminiscent of emerging markets rather than that of a developed economy. When state powers intersect with corporate governance to enforce a board restructuring devoid of meaningful oversight, the principles of equitable investing become entrenched in danger.

Performance at Odds with Governance

Ironically, while the government moves to reshape leadership at Leonardo, the company has been performing exceptionally well. Recent reports indicate substantial new orders and a significant reduction in net debt. Under the stewardship of outgoing CEO Roberto Cingolani, Leonardo achieved a considerable total shareholder return of 91.75% in 2025 alone. The government's action, therefore, appears to disregard the outstanding financial performance and leadership demonstrated by Cingolani.

As concerns mount, Wyser-Pratte has begun discussions with legal advisors in Rome, preparing for a formal request for an independent inquiry into the AGM's proceedings. This endeavor is aimed at ensuring that minority shareholders receive the clarity and accountability they deserve.

A Historical Paralle

Recalling his past experiences, Wyser-Pratte likens the current situation to his previous encounters in 1996 when he confronted similar issues at Wallace Computer Services. There, he witnessed how entrenched interests can manipulate corporate processes when they perceive a loss on the horizon.

Wyser-Pratte's activism is rooted in a commitment to uphold the sanctity of shareholder democracy, and he is determined to seek answers for the minority shareholders of Leonardo SpA. The ship of corporate governance needs steady hands to navigate turbulent waters, a principle Wyser-Pratte champions staunchly.