Chesnara Regulatory News (CSN)

15th November 2023

CHESNARA plc

("Chesnara", the "Company" or the "Group")

RESPONSE TO VOTING RESULTS AT 2023 ANNUAL GENERAL MEETING

In accordance with Provision-4 of the UK Corporate Governance Code, Chesnara (CSN.L), the European life insurance consolidator, today provides an update to our statement of 16th May 2023 regarding the result of the poll vote at the 2023 Annual General Meeting ("AGM") on Resolution-2 to approve the Directors' Remuneration Report.

Resolution-2 passed with 72.66% of votes in favour. Since the AGM, the Remuneration Committee has engaged with the Company's major shareholders and proxy agencies to help understand the reasons for votes cast against Resolution-2. Three areas have been identified, which are in line with those raised by proxy investor bodies in their respective reports published just in advance of the 2023 AGM. We set them out below, alongside the proposed response to each.

LTIP to be Based One Third on Surplus Emergence

One area of feedback related to the use of cash generation metrics in both the Short Term Incentive Scheme ("STIS") and Long Term Incentive Plan ("LTIP"). In response to this, for LTIP awards granted in FY24, the Commercial Cash Generation metric will be replaced by a new Surplus Emergence metric. The existing relative TSR and Economic Value growth metrics will be retained. Each metric will be weighted one third of the assessment in line with the current approach.

Surplus Emergence will be one of the Group's KPIs and will be consistent with the definition used for reporting elsewhere in the annual report and the Company's other trading updates. It represents the operational surplus that has been generated in the period, largely a function of the movement in the solvency position of the insurance subsidiaries within the Group and takes account of the buffers that management has set to hold over and above the solvency requirements imposed locally by our regulators.

All LTIP Performance Targets to be Disclosed Prospectively

Shareholders expressed a preference for LTIP performance targets to be disclosed prospectively, in line with the approach the Company has always taken for the relative TSR metric. The Company acknowledges that this is increasingly common practice and going forward will disclose threshold targets prospectively going forwards, commencing with the targets for the LTIP awards to be granted in 2024.

Assessment of the Company's M&A Activity Within the Strategic Scorecard of the STIS

For 2024, the Remuneration Committee is proposing to make a small modification to the performance measures to be included in the STIS. The Strategic Scorecard (30% weighting) will be replaced by an ESG metric (5% weighting) and a Strategic Activity Scorecard (25% weighting) which focuses on the assessment of value-enhancing strategic activities including M&A, management actions, operational programme delivery and pipeline development. The weightings within the Strategic Activity Scorecard will vary year-to-year to reflect the relative priorities for the Company.

This means the assessment of M&A activity for the FY24 STIS will be entirely contained within the Strategic Activity Scorecard with no discretion applied. Full details of the assessment of the Strategic Activity Scorecard will be included in the Directors' Remuneration Report each year.

The Remuneration Committee would like to thank the major shareholders who have engaged in the consultation exercise since the AGM and believes that the proposed changes address the key issues raised. In accordance with the Corporate Governance Code, a final summary will be provided in the Company's 2023 Annual Report.

For further information, please contact:

Investor Enquiries

Sam Perowne

Head of Strategic Development & Investor Relations

Chesnara plc

E - sam.perowne@chesnara.co.uk

Media Enquiries

Roddy Watt

Director, Capital Markets

FWD

T - 020 7280 0651 / 07714 770 493 

E - roddy.watt@fwdconsulting.co.uk

Notes to Editors

Chesnara (CSN.L) is a European life and pensions consolidator listed on the London Stock Exchange. It administers approximately one million policies and operates as Countrywide Assured and CASLP in the UK, as The Waard Group and Scildon in the Netherlands and as Movestic in Sweden.

Following a three-pillar strategy, Chesnara's primary responsibility is the efficient administration of its customers' life and savings policies, ensuring good customer outcomes and providing a secure and compliant environment to protect policyholder interests. It also adds value by writing profitable new business in Sweden and the Netherlands and by undertaking value-adding acquisitions of either companies or portfolios.

Consistent delivery of the Company strategy has enabled Chesnara to increase its dividend for 18 years in succession.

Further details are available on the Company's website (www.chesnara.co.uk).