Elliott believes operational and governance improvements would allow Pernod to unlock much of the value that the company is capable of delivering, improving the strength and sustainability of the company for all stakeholders.
We welcome the decision to start buybacks, albeit we had hoped for more, and would note the 2019 RoTE (return on tangible equity) target is prudently based on flat year-on-year revenue developments, which suggests there is still room to beat this target in our view.
Keeping pace with digital advances and disruptive risk, and driving a strategy focused on long-term value will hinge on having the right talent in the boardroom and throughout the company.
Audit committee members continue to tell us that it is increasingly difficult to oversee the major risks on their agenda on top of their core oversight responsibilities.
When we announced on our earnings conference call that we were taking our dividend down to 4 cents a year, we didn't do anything positive for our retail shareholder base and they have been exiting the stock, I think, as a result.
