Hanover, Germany – Continental Corp.’s supervisory board has announced a series of measures to increase liquidity and drive sustainability amid ongoing economic uncertainty caused by Covid-19 pandemic.
The German technology group has proposed to reduce its dividend from €4.00 to €3.00 per share this year, with a total distribution of €600 million, said a 3 June statement.
Continental shareholders will vote on the proposal during a 14 July virtual annual shareholders meeting.
“The economic landscape continues to be characterised by a high degree of uncertainty due to the impact of the coronavirus,” said Prof. Wolfgang Reitzle, chairman of Continental’s supervisory board.
The new dividend proposal, which is 37% lower than last year’s dividend of €4.75 per share, “strikes a balance between the short-term and long-term interests of Continental,” Reitzle added.
Conti’s supervisory board has also decided to present a new remuneration system for executive board members to make it more aligned with the group’s long-term sustainable development.
The new system will partially link board members' remuneration to share price performance compared to relevant listed companies in the automotive sector. It will also be based on the achievement of sustainability goals set out by the German group.
Relevant sustainability aspects for now include the full transition to renewable sources for all externally procured electricity this year, a gradually increased representation of women in management positions, a reduction in the rate of accidents and sickness, and a higher proportion of recycled waste, Conti said.
The move, it noted, will drive a “fundamental transformation process that is currently underway in the entire automotive industry.”
As part of the proposal, the remuneration of the Continental supervisory board members only include a fixed amount without any variable component.