Sad news for the Naspers/Prosus boards. Their N shareholders are as vehemently opposed to them as they were a year ago. So much for the concerted pre-AGM campaign to engage with N shareholders and demonstrate the folly of their opposition. Not of course that either board really gives a damn about what the N shareholders think – proof of that can be found in ten years of barmy value-destroying remuneration policies.
After all, the N shareholders have zero real power: their shares carry one vote each compared to the 1,000 votes every A share holds. Still, perhaps even Prosus/Naspers directors get a little uncomfortable when 71% of N shareholders vote against their remuneration policy and its implementation. And almost 40% vote against the re-election of very long-standing directors. That was how things went at the 2025 annual general meeting.
A year later, not much has changed: last week, 70% of N shareholders voted against Naspers’ remuneration policy and 66% against the implementation policy. Hardly surprising when you consider what the Prosus and Naspers share prices have done in recent years. Since Prosus listed in Amsterdam 2019, it has increased 32% in value.
By comparison, says Errol Keyner, deputy MD of European Investors/VEB, the Nasdaq has tripled in value over that period. That’s a significant comparison given Prosus uses its Nasdaq peers to determine its remuneration.
“Although Prosus’s share price experienced a surge at one point, it has since fallen back to around the level it was when Bloisi became CEO two years ago,” said Keyner adding, “Prosus’s share price movements largely track those of the Chinese giant Tencent.”
That’s even though Prosus’ many investments in early-stage e-commerce businesses are no longer a bottomless pit but are generating positive cash flow, says Keyner. It makes CEO Fabricio Bloisi’s “moonshot bonus” all the more irksome to shareholders. He’ll score – or fail – because of how Tencent performs. Chairman Koos Bekker made a valiant but unpersuasive attempt to persuade the AGM attendees that Prosus has input into Tencent strategy.
“I sit on the Tencent board, we contribute to them,” he told the meeting. But, other than being proof of how consistently badly Prosus handles remuneration, the “moonshot” now seems academic.
Remuneration chairman Craig Enenstein says when the incentive was put in place two years ago, Prosus’ market capitalisation had to increase 19% each year for Bloisi to have any hope of getting the $100m payout. Because of the share’s underperformance, it must now increase 30% per annum.
That’s unlikely although not impossible if Tencent makes a breakthrough with AI. Enenstein told the meeting, “the Committee takes seriously that the incentive could lose its motivational force” but noted there were other rewards for Bloisi.
At which stage Bloisi promptly reminded shareholders he was an entrepreneur and was going to create a lot of value.
“My motivation is as high as ever and tomorrow it will be a little higher,” he told the meeting. Then there’s the votes against directors.
This year, 50% voted against Rachel Jafta’s re-appointment to the board and 40% against her re-appointment to the Social, Ethics and Sustainability Committee (SESC).
Remarkably Jafta is described as an independent non-executive director although she has been on the Naspers board for 23 years. This description may hint at the fact that a small group of individuals holding Naspers and Prosus A shares are the only real decision makers.
In addition, Debra Meyer’s re-election to the SESC was opposed by 38% of N shareholders a year ago and 32% this year. Meyer, who is also described as an independent non-executive director, was appointed to the Naspers board in 2009.
Steve Pacak, who died in April, was also vehemently opposed by N shareholders at the 2025 AGM. Even Bekker is notching up opposition: 18% voted against his re-election last year. So, it’s not just the group’s remuneration policies that irk N shareholders.
It’s possible the company’s board profiles would look significantly different if Naspers/Prosus was run in terms of traditional corporate governance practices. But, as we all know, it’s not. Yet another reminder that they operate like your typical autocracy was the 27% hike in board fees the directors have awarded themselves for financial 2027.
And they’ve lined up another 23% increase for 2028. ESG analyst at Aeon Investment Management, Malesetja Teffo asked the Naspers board what justified the hike and was told something about benchmarks and non-executive directors not receiving any equity-based compensation.
“I’m not convinced,” Teffo told Financial Mail after the meeting. “Their main justification was that NED fees are ‘materially below the benchmark’ however they did not disclose the peer companies used to reach that conclusion.” “The board also pointed to inflation and cost of living as factors but this explanation is difficult to reconcile with the numbers, as an increase of this magnitude is far beyond current inflation.”
Teffo said that while they recognise the board’s discretion to set remuneration policy “an increase of this size and pace must be supported by transparent data if it is to hold the confidence of long-term shareholders.”
Making it all a little more distasteful is the fact the only reason we know how Naspers N shareholders vote is because the JSE listings requirements oblige companies to disclose the voting of each type of share category. It’s a commendable requirement although it doesn’t make up for the fact the same JSE allowed the company to list with a category of shares holding 1,000 votes per share compared to the one vote of the N shares.
Still, it’s a lot better than the Amsterdam Stock Exchange where separate disclosures aren’t required and therefore Prosus doesn’t make them. However a crude extrapolation of the comparative figures indicates that Prosus N shareholders are voting in line with the Naspers N shareholders.
It’s difficult to imagine any of this will change when Bekker steps down from the board at the end of financial 2028. That’s because, as a major holder of both Naspers and Prosus A shares, he will continue to play a powerful role.