German electronics company Infineon has faced down an investor revolt that had developed into a test case of the country’s corporate governance practices.


In a direct challenge to the company’s leadership, rebel shareholders led by Hermes, a U.K. activist investor, had nominated their own candidate for election to the post of supervisory board chairman, a key governance role.


The Hermes campaign was the first time an institutional investor had tried to force out a senior director of a big German company.

But at a shareholder meeting on Feb. 11, 73 percent of those who voted rejected Hermes’ candidate, leaving the board free to move its own man into the job.


The rebels had argued that the company’s plan to appoint existing director Klaus Wucherer as chair of its supervisory board was a bad one. Wucherer has been a director of the company since 1999; the rebels felt a more independent figure was needed.

The other five supervisory board members up for election at the meeting each received more than a 99 percent vote in favor.


The rebels claimed that shareholders made clear their lack of support for the supervisory board at last year’s annual general meeting, when only just over 50 percent voted to approve its work. “The vote indicated a clear demand for extensive renewal of the supervisory board,” they argued.

Hans-Martin Buhlmann, head of VIP, a German shareholder advisory group, told the Financial Times that the appointment of Wucherer was “a violation of shareholders’ wishes”.