Dear shareholders, welcome to the Annual General Meeting of Shareholders of Wolters Kluwer N.V. This meeting is being broadcast via live webcast, and a recording will be made to correctly produce minutes. During today's meeting, all members of the Supervisory Board and Executive Board are present. Our auditor for the 2024 Annual Report, Mr. Savert of Deloitte Accountants, and our company's notary, Mr. Nederlof of Allen & Overy Shearman, are joining us here in Alphen aan den Rijn as well. We are pleased that many shareholders took the opportunity to exercise their voting rights by way of electronic or written proxy. We have complied with all statutory provisions and the provisions of our Articles of Association for convening this meeting, and therefore we can resolve validly at this meeting on all of the agenda items. As soon as the exact number of shares present or represented is known, I will inform you.
Let us now turn to the meeting agenda. I would like to discuss agenda items 2A, B, C, and 3A together. To introduce agenda items 2A and 3A, I would now like to give the floor to Ms. McKinstry, CEO and Chair of the Executive Board.
Thank you, Ann, very much. I'd like to add my welcome to all of you who have joined the meeting here in Alphen and for those of you joining the meeting via the webcast. I will provide a review of our performance in 2024, covering both financial and sustainability highlights. I'll touch on some of the key drivers of that performance, such as our growth in our cloud software solutions and our continuous investment in product innovation. I'll also summarize the key priorities for our new three-year strategic plan, which we launched at the start of 2025, and I'll finish up with a summary of our first quarter trading update and the outlook for the remainder of 2025. On the next slide, you can see that this gives you the highlights for 2024. We delivered 6% organic revenue growth and further increase in our operating profit margin to 27.1%.
This operating performance helped drive an 11% increase in diluted adjusted earnings per share in constant currencies. Adjusted free cash flow increased 9% in constant currencies, better than we expected. Return on invested capital improved to 18.1%. Our balance sheet remains in a strong position with leverage of 1.6 times at year-end. The key strategic highlights of last year were that our expert solutions grew 7% organically, reaching 59% of group revenues. Among the expert solutions, our cloud software products grew 16% organically. We sustained high levels of product investments at 11% of revenues, launched several new products, and introduced generative AI features to a number of our existing platforms. Last year, we also completed the centralization of core functions, enabling these teams to better support the business in the future. We continued our focus on talent, and we're pleased to have maintained our employee engagement scores at 78.
We reduced our direct emissions by 11% and raised our near-term ambitions for Scope 1 and Scope 2. All in all, a good year built upon our track record of delivering continuous improvements, as you can see on the next slide. The top left chart shows our organic revenue growth, and as you can see, we delivered another year of 6% organic growth. Supporting this growth is the very consistent performance of our recurring revenue streams, which grew 7% organically last year. Our non-recurring or transactional revenues are more volatile, and last year were broadly stable, increasing 1%. The chart on the top right shows our track record of improving our adjusted operating profit margin. Last year, we had a 70 basis point increase in margin, reflecting our continuous efforts to drive operational efficiencies as well as net positive one-time item.
The charts along the bottom of the slide show steady improvement over the years in increasing diluted adjusted EPS, return on invested capital, and adjusted free cash flow. Now let's move to the next slide where we talk a bit about the key drivers of our growth. Recurring cloud revenue has been an important driver of organic growth. Cloud revenues grew at a compound annual growth rate of 18% in constant currencies over the past three years. Cloud solutions represent 42% of our total software revenues in 2024, and thereby, for the first time, exceed our on-premise software revenues. This slide shows how our software is split by division. As you can see, tax and accounting represents about half of our total global software revenues. In this division, we are making good progress in migrating our existing customers from on-premise solutions to the cloud.
The cloud solutions bring many benefits to our customers, including more functionality and a wide range of modules. The other division where cloud-based software is growing fast and becoming substantial is in Corporate Performance and ESG. In this division, the new customers we are signing are showing a strong preference for cloud-based solutions. Over time, we will see the proportion of recurring revenues in this division rise, which will make it more stable and predictable. Turning to the next slide to highlight some of the key innovations. We have a long-standing track record of driving revenue growth through product innovation. In 2024, we rolled out several important new innovations, many of them using generative AI technology. I will highlight just a couple of examples. In our Health division, we introduced UpToDate Enterprise last year.
This is an advanced version of our flagship UpToDate clinical decision support tool that is designed for healthcare institutions. UpToDate Enterprise includes an AI-driven analytics dashboard and an enhanced search function powered by generative AI. The GenAI features allow doctors to ask complex medical questions in natural language and get a precise answer quickly, but also receive prompts with related questions to support the doctor in making an even more informed decision. Our Corporate Performance and ESG division last year released an enhancement to its CCH Tagetik ESG or CSRD reporting tool. In 2024, we added the ability to calculate spend-based and activity-based Scope 3 emissions as an add-on module to our platform. This new module allows organizations to collect ESG data and convert it into the required regulatory standards.
It also allows companies to analyze their performance against ESG targets and how it interrelates to both financial and operating performance. Now let's take a look at our sustainability highlights for 2024. Each year, we measure employee engagement and employee belonging with a global survey conducted by a third party. In 2024, both scores were maintained at 78% and 75% respectively, as you can see in the two charts on the top left. We support engagement and belonging with a wide range of initiatives and programs throughout the year, which you can read about in our annual report. Our long-term goal for both engagement and belonging is to reach the top quartile of companies. Bottom right, you can see the progress we have made on our real estate rationalization program.
In 2024, we achieved an 8% underlying reduction in our global office footprint, which helped drive an 11% decline in our Scope 1 and Scope 2 emissions. Last year, we submitted our targets to SBTI, and I'm pleased to share that these targets were validated. We are committed to reaching net zero greenhouse gas emissions across our value chain by 2050. Now let me update you on our proposed dividend distribution and share buyback program. Due to the strength of our balance sheet, we are in a position to invest organically in the business, make acquisitions, while at the same time also rewarding our shareholders by returning cash. Today, we are proposing a 12% increase in the total dividend per share to EUR 2.33. This results in a final dividend of EUR 1.50 per share to be paid out in early June. The dividend proposal is subject to your approval today.
In February of this year, we announced our plan to repurchase EUR 1 billion in shares during 2025. As of May 13th, we have completed almost a third of this buyback program. Now let's look at our share price performance on the next slide. We normally show this chart for a shorter period of time, but my team felt it was an appropriate time to show a longer-term chart. When I became the CEO of Wolters Kluwer in 2003, the share price was around EUR 14 per share. Over the course of our 22-year journey, transforming from a print publisher to an expert solutions company, we've seen almost a tenfold increase in the share price. This strategic transformation has delivered significantly higher returns compared to the AEX and the Euro Stoxx 600. Last year was a strong year for the stock. Our shareholders benefited from a 25% increase in our share price.
Over the three-year period ending December 31, 2024, Wolters Kluwer's shares increased 55% in value. Now, so far in 2025, equity markets and our share price have seen a bit more volatility. Some of this is due to uncertainty around U.S. policies and tariffs, as well as volatile exchange rate movements. Our shares, however, have almost recovered to where we started at the beginning of this year. I have great confidence in the future for Wolters Kluwer. We just kicked off a new three-year strategic plan that aims to deliver strong financial performance. Let me walk you through a couple of the key priorities of the 2025 to 2027 plan. This plan, of course, builds on the strong foundation of prior strategies, but we aim to put emphasis on three key priorities. The first priority is to scale expert solutions.
We plan to focus more on driving penetration of our cloud-based expert solutions and leveraging our data and content to create more valuable insights for our customers. The second priority is to accelerate growth. Here, we plan to step up our pursuit of attractive high-growth adjacencies with a build-buy or partner approach. We intend to accelerate innovations that enhance productivity and outcomes while further developing partnerships that extend our market reach. Our third priority is to evolve our capabilities. We will put more emphasis on enhancing our go-to-market capabilities and sales effectiveness, and we will continue to adopt new technologies that drive operational efficiencies, create a great place to work, and achieve best-in-class ESG performance. Now let's turn to the trading update that we issued last week. We had a solid start to the year. Organic growth was 5%, which was in line with our expectation.
Recurring revenues, which make up 83% of our total revenues, sustained 7% organic growth. Non-recurring and transactional revenues were a little weaker in the first quarter. Expert solutions grew 6% organically, and within expert solutions, cloud software products grew 14% organically. Divisional performance was closely in line with expectations. Tax, Health, and Financial and Corporate Compliance slowed modestly year-on-year, while Legal and Regulatory and Corporate Performance in ESG delivered faster growth compared to a year ago. Adjusted operating profit increased 11% in constant currencies, and adjusted free cash flow increased 5% in constant currencies. Despite the current macroeconomic and policy uncertainty, we are confident in reiterating our guidance for the full year. Turning to the next slide, we expect full year 2025 organic growth to be in line with the prior year.
First half organic growth is expected to be slightly lower due to challenging comparables in Health and Tax and Accounting. The adjusted operating profit margin is expected to see improvement in 2025, led by Health and Corporate Performance and ESG. We expect adjusted free cash flow will be broadly stable compared to the prior year in constant currencies, with cash conversion to be within 95%-100% due to higher capital expenditures and lower working capital inflows. We continue to guide to further increases in return on invested capital between 18%-19%. Finally, we continue to expect diluted adjusted EPS to show mid-single digit growth in constant currencies. Now let me just briefly touch on the guidance by division. In Health, we continue to expect full year organic growth to be in line with or slightly below the prior year.
In tax and accounting, we continue to expect full year organic growth to be in line with prior year. In finance and corporate compliance, we continue to expect organic growth to be slightly below prior year. In legal and regulatory, we continue to expect full year organic growth to be in line with the prior year. Finally, in corporate performance and ESG, we continue to expect full year organic growth to be above prior year. In summary, a solid start to the year, allowing us once again to reiterate our outlook for 2025. As this is my last Wolters Kluwer annual general meeting as CEO, I want to thank everyone for attending, including all of you who have engaged with us throughout the year and those of you who have cast their votes in the AGM.
Leading this company over the past 20 years has been a privilege, and I appreciate all of the questions, suggestions, and support throughout the year as we have transformed Wolters Kluwer. The company is well positioned, and I'm confident that Stacey Caywood and the team will lead Wolters Kluwer to new heights. I look forward to continue to lead the company over the remaining months and to ensure a smooth transition to Stacey. Thank you very much.
Thank you, Nancy. Ms. Heleen Kersten, Chair of the Selection and Remuneration Committee Dealing with Remuneration Matters, has prepared an introduction on agenda item 2C. This agenda item is submitted to you for an advisory vote in accordance with Dutch law.
By voting, you can indicate whether, in your view, the 2024 remuneration report provides a clear and comprehensive overview of all remuneration awarded to individual members of the Executive Board and Supervisory Board in the last financial year. Let's go over to Helene.
Thank you, Ann. Related to item 2C, which is the advisory vote on the 2024 remuneration report, I would like to provide a summary of how the company's performance against one-year and three-year targets determined the remuneration outcome for 2024. The slide shows the short-term incentive plan, or STIP measures, targets, and actual performance for the year 2024. The STIP was linked to three financial measures and three non-financial measures, as shown in the table. The financial measures were weighted at a combined 90%, while the non-financial measures were weighted at 10%.
In addition to driving financial and sustainability results, the challenge for Wolters Kluwer in 2024 was to deliver on several important product innovations, such as generative AI features, whilst completing the centralization of functions. As described in the annual report, the financial outcomes for 2024 were in line with or ahead of STIP targets, resulting in above-target payout. Revenue performance was in line with target. Adjusted net profit was 2% above target, while adjusted free cash flow was 6% above target. In the case of the non-financial measures, performance was more varied. The employment belonging score came in just short of target, which was to improve the score by one point compared to the prior year. The indexed cybersecurity maturity score exceeded the target, which was to maintain the score in line with the benchmark for high-tech companies.
Finally, the office footprint, a measure aimed at reducing Scope 1 and Scope 2 emissions, was reduced by 9%, exceeding the target, which was a reduction of between 5% and 6%. More details can be found in the remuneration report. Let's turn to the long-term incentive plan, or LTIP, on the next slide. The LTIP covered the three-year period of 2022-2024 and included targets for relative TSR, diluted adjusted EPS growth, and return on invested capital. Performance across these three measures was very good, resulting in above-target payouts on all three measures. With respect to relative TSR performance, Wolters Kluwer ranked fourth amongst the TSR peers, as you can see on the chart on the left. With respect to diluted adjusted EPS growth, Wolters Kluwer delivered a compound annual growth rate of 10.2%, which was ahead of the target of 9.4%.
These figures are calculated in current currencies, in constant currencies. With respect to return on invested capital, Wolters Kluwer achieved 18.1% in 2024, which was ahead of the target of 17.4%. These figures are also calculated in constant currencies. Further detail can be found in the remuneration report. With that, I would like to turn the proceedings back to the Chair.
Thank you, Heleen. The financial statements for the year 2024 have been audited by the independent external auditor, Deloitte, and their opinion can be found on pages 223 to 231 of the 2024 annual report. I would now like to invite Bas Savert, Partner at Deloitte, to give a brief overview on the audit work performed by his firm. Boss, the floor is yours.
Thank you. I will just provide a brief overview, so I won't touch every detail.
We have issued our auditor's report on the 25th of February, and as mentioned by the Chair, it is included in the back of the annual report. The slide that is shown on the screen shows some of the key points of our 2024 audit. In our auditor's report, we have included three key audit matters, and those matters related to two areas that we have seen before, being revenue recognition and valuation of goodwill, and one new area related to the acquisition of a subsidiary during the year. For both acquisition accounting and for the valuation of goodwill, we have focused on the significant estimates made in the underlying fair value calculations. We involved valuation specialists in performing this work.
For revenues, our finding is specifically focused on the fact that there is a variety of fulfillment systems throughout the group and that there is not an option to perform the audit in a very standardized or centralized way. This means that we have to design audit procedures that are focused and mainly of a substantive nature. Besides the key audit matters, we also obviously had other audit attention areas, some of which included the group audit, the coordination of our worldwide audit work, and areas such as fraud and compliance. We were supported in the group audit by component auditors in Europe and in the U.S., and our oversight comprised performing file reviews and visiting and discussing with those auditors the work that they performed and looking at their working papers. In our centralized work, we also used other specialists.
I already mentioned the valuation specialist, but we also worked with specialists in the areas of ESG, financial reporting, pensions, and forensics. We had periodic meetings with management and with the Audit Committee to discuss our audit approach and our findings and reporting deliverables. As shown on the slide, we applied a materiality level of EUR 70 million, which was the same as in last year. In addition to the financial statement audits, we have also performed limited assurance procedures on the sustainability statements of the company, which are also included in the annual report. Considering the status of the CSRD requirements in the Dutch legislation, the reporting and our engagement are voluntary in nature. In this first year, we have paid particular focus to the double materiality assessment, to the value chain, Scope 3, as well as relying on third parties when looking for information to support the KPIs.
Our assurance report is included on page 232 and the following pages. Finally, 2024 was our last audit before the rotation. We have worked closely with KPMG, and the transition is now substantially completed. We would like to thank management and the shareholders for their trust in Deloitte in the last couple of years. Thank you.
Thank you, Bas. We would now like to take questions relating to the 2024 annual report. This includes agenda items 2A, B, and C, plus item 3A, the report of the Executive Board, including the sustainability statements, the report of the Supervisory Board, the remuneration report, and the financial statements. We will start with some questions that were provided by shareholders in advance of the meeting, in this case by the Dutch Association of Shareholders, VEB.
These questions will be asked on behalf of VEB by Meg Geldens, Head of Investor Relations for Wolters Kluwer.
Thank you. I'll start with the first question. Given the retirement of Nancy McKinstry planned in about a year's time, what specific challenges do you foresee for Stacey Caywood in assuming the CEO role? How is the company managing the risks of strategic discontinuity during the leadership transition?
Wolters Kluwer has long established talent management and development programs in place to plan for succession. The Supervisory Board is convinced that Stacey Caywood is the ideal candidate to succeed as CEO. Stacey is someone who has been closely involved in developing the strategy for the group. She is someone who has successfully turned around the fortunes of our Legal and Regulatory division, and she has revitalized innovation in the Global Health division.
In those leadership roles, Stacey has considerable experience in building the right teams and organizations, working with the Executive and Supervisory Boards, representing the company to external stakeholders, and managing her time and energy. Stacey has deep knowledge and understanding of our customers and products and extensive experience in leveraging the latest technology in product development. She also has strong internal support from senior leaders across the company. We have planned for a one-year transition period during which Stacey will transition into the CEO role. With an internal candidate of this caliber and the well-developed transition plan, the Supervisory Board believes that the risk of a strategic discontinuity is greatly diminished.
Shall I read out the next question?
Yes, please. Please continue with, I think there are four or five questions. Please continue and we'll answer them.
There's about five more, so I'll read the next one out.
Given the high exposure to U.S. business, does the currency sensitivity analysis that's provided in the annual report still hold given the strong dollar devaluation lately? As a secondary part of that, to what extent does the linear relationship implied by the sensitivity analysis still remain valid in the case of a more extreme move in foreign exchange rates?
Kevin, that's all yours. Thank you.
Yes, the currency profile of the sensitivity analysis—sorry about that. Yes, the currency profile, the sensitivity analysis that we've offered you in the annual report still does hold. As a rule of thumb, for every one cent difference in the EUR/USD rate, we have an opposite EUR 0.045 movement on EPS, and that is a linear relationship that would hold through.
I would say that moving forward, we do look always to create natural hedges for that sensitivity exposure by matching up expenses and revenues in the geographies where we generate those revenues, so we will continue to do that. Yes, do rely on that sensitivity in the annual report.
Next question from the VEB is, are there any additional macroeconomic or regulatory risks at the moment, especially under the new U.S. administration, that is relevant for an investor in Wolters Kluwer?
Kevin?
Certainly. Our business is certainly impacted by change, and change is good at Wolters Kluwer. Whether there are more regulations or changes in regulations or less regulations, that allows us to engage with our customers and help them navigate and understand that change.
Now, any type of macroeconomic change or risk impacts all companies, but I would say with Wolters Kluwer being that over 80% of our revenues are recurring, we are probably less impacted by those sorts of changes. Very few of our products are centralized around one regulation. Mostly, we have recurring revenue subscription products or platforms that offer a wide variety of advice on how to navigate regulation. There is one product in our FCC division that dealt with one regulation, our beneficial ownership, that had to do with the Corporate Transparency Act, and as enforcement of the Corporate Transparency Act has been suspended, obviously that is an example where there would be a direct impact. Now, last year, that particular product generated about EUR 10 million in revenue, which is less than 0.2% of revenue. So the exposure is quite diverse.
Great. Thank you.
I'll go to the next question from the VEB. In 2024, Wolters Kluwer invested approximately 11% of revenue in product development, with a substantial portion directed towards AI-enabled enhancements. What quantifiable key performance indicators, for example, ARR, uplift, churn reduction, pricing power, must these AI investments deliver in 2025 and beyond to validate their scale and strategic relevance?
Nancy?
Thank you. As you point out, we do invest a significant portion, about 11% of our revenues annually back in new and product enhancements. We've been using AI for over a decade. In fact, more than 51% of our digital revenues include some form of AI, whether that's robotic process automation or predictive analytics, and of course, more recently, GenAI. All of these enhancements support retention, price increases, new sales, and in some cases, brand new revenue streams from those activities.
In the broad, this innovation is supporting good organic growth in our expert solutions, and we will continue to work to enhance it using a lot of these new GenAI features. Over time, we will have more indications of exactly how much of our revenues are specifically tied to GenAI. It's still early days in the market in terms of how customers are responding to some of these new technologies.
Okay. I'll move to the next question from the VEB. If the EU Omnibus initiatives leads to a material reduction in administrative requirements and the implementation of the CSRD experiences further delays, what is the estimated revenue exposure for the CP and ESG division arising from such regulatory setbacks?
Just to frame the question—sorry.
No, no, no, no, no. Just don't worry, I wasn't going to answer.
Just to frame the question, it is through our CCH Tagetik and Enablon solutions that we offer our customer support with ESG as an add-on module that's used today by about 200 companies, mostly in Europe. The EU Omnibus changes really have exempted smaller companies and eliminated some of sector-specific disclosures and generally kind of reduced the number of data points. Because we tend to serve very large corporations in the market, this specific change doesn't really impact us to a great degree. The delay certainly perhaps has some modest impact on our sales cycles, but all in all, we still see a lot of interest in our new modules and our ESG offerings among particularly large corporates in Europe.
Okay. A final question from the VEB on this set of agenda items. The auditor identified revenue recognition as a key audit matter.
What enhancements to ERP harmonization or control automation are planned to reduce this risk category?
Kevin, that last one's for you.
Will do. Actually, yes, as you heard in Bas' remarks earlier, that Wolters Kluwer does have a number of historical legacy systems within the organization. The auditors cannot apply a one-size-fits-all type of approach to their audit. In planning their audit, they do have to look at different systems that we are using, particularly for revenue recognition. As we start to harmonize some of these legacy systems onto common platforms, we will have the opportunity to streamline that process. Hopefully, in the future, our auditors will be able to apply more of a centralized approach.
Thank you, Meg. I believe VBDO, who is with us today, also has a question or two on these agenda items. I would like to turn the floor over to VBDO.
Thank you. The Dutch Association of Investors for Sustainable Development, VBDO, would like to continue engagement with Wolters Kluwer about its sustainability performance. Thank you for the opportunity. For this year's annual general meeting, we have selected the following questions on biodiversity. Wolters Kluwer reports a limited impact on biodiversity due to its office-based operation and service-oriented business model. However, with growing concerns around biodiversity loss and the environmental footprint of sectors such as ICT, particularly through energy use, it remains important to assess potential biodiversity risks across the value chain. VBDO welcomes the rollout of Wolters Kluwer's new supplier sustainability assessment tool in 2025, aimed at improving insights into the social and environmental impacts of its upstream and downstream activities.
The questions: How will this tool enhance Wolters Kluwer's ability to assess biodiversity impacts across the value chain, and how will these findings be integrated into the company's broader sustainability strategy and reporting? Will this tool also be used to develop targets or establish indicators to monitor performance? When does VBDO expect can VBDO see this being included in the annual report? Living wage. Living wage is a critical component of social sustainability, ensuring workers earn enough to meet their basic needs. Wolters Kluwer states in the annual report that supply chain workers may not have adequate wages. During last year's engagement, Wolters Kluwer stated that insight into social aspects of its supply chain were still limited, but that efforts were being made to improve supply chain transparency. How does Wolters Kluwer assess whether suppliers are meeting living wage standards?
What mechanisms are in place to monitor and enforce compliance with living wage requirements across the supply chain? When could VBDO expect more detailed reporting on this topic in the annual report? In its 2024 annual report, Wolters Kluwer outlines their initial alignment with the European Union's Corporate Sustainability Reporting Directive, CSRD, and the European Sustainability Reporting Standards, ESRS. VBDO commends Wolters Kluwer for its transparency regarding its CSRD implementation and wants to encourage Wolters Kluwer to take further steps. Wolters Kluwer's stakeholders' policy indicates that the company engages with society through various initiatives and dialogues. Could the company provide more details on the specific dialogues held with external stakeholders? Could Wolters Kluwer further reflect on the implementation of the CSRD framework, sharing what key challenges and successes were encountered in the past year? Thank you.
Nancy, could you address the questions, please?
Thank you very much for your questions. Beginning with biodiversity and specifically the new reporting tool that we've just implemented in the last six months or so. First, just to remind everybody that our focus is very much on our supplier carbon emissions as well as workplace conditions based on our double materiality assessment. We are using our focus and this new reporting tool to really hone in on paper supply. That is our biggest focus area, and we're gathering some additional new information. It's early days with the new tool, and our expectation is that as we gather more information, we'll report on that in the next annual report. That is our work continues in that area.
As it relates to living wage, as we have reported to our shareholders, we do ensure that our suppliers sign certain codes of conduct, which include adherence to living wage standards. Through this tool and through the other mechanisms, we audit those findings and follow up to make sure that they are in compliance with that code of conduct. With the new tool, we fully expect that we'll have some additional information to report on. Finally, with the CSRD, I think our biggest challenge is, of course, it's a large volume of data that all companies have to report on. I think the challenge that we're looking to enhance as we think about the next annual report is both reporting, but also making it a bit more readable.
I think we feel very good about the double materiality analysis that we did, and that still is a very solid foundation for us as we look forward. We will look now to better integrate some of what we are doing on the sustainability front into our operations. I think that will be an ongoing effort that the team will continue to carry forward. Thank you.
Are there any other questions from shareholders in the room? Thank you for your question.
Goedemorgen.
Good morning. Please state your name.
Mijn naam is Robert Vreeken. We Connect You Public Affairs & Investor Relations. The results are fantastic. Good structural growth for the intellectual heart of the world. Wolters Kluwer is talking about organic growth, and I am a big supporter of organic growth. However, there are points of attention towards this subject.
Worldwide diversity is decreasing dramatically by disappearing 600,000 plants and animals in the world. Since the Paris Agreement in 2015, a size with the forest of three times the Netherlands disappears on an annual basis. The past 10 years, a forest worldwide with the size of two times France disappeared. That might be slightly worrying. This is the growth I'm talking about worldwide. It's important that companies work together worldwide and use a part of their profit to stop this development. A nice example is IKEA. IKEA has a forest with the size of Germany, and now we're talking business. Kluwer has an excellent reputation with his leading excellent network. For more than 20 years ago, there had been the opportunity to turn the current trend around.
For the children and grandchildren of the board of directors and the Supervisory Board and share and stakeholders, the organic growth is quite depressing. Certainly given the fact that Wolters Kluwer is the intellectual heart of the world. How can you use it to turn this development? I think I feel that it's better to invest a substantial part of the profits in forests like IKEA than buying back your own shares because it's pennywise but not pound foolish. That's my first questions. What are you going to do? You're talking about children and grandchildren of shareholders and stakeholders. In fact, there's nothing what we are doing.
Nancy?
Yes, thank you for your statement and question. How do we see our role as a corporate citizen around the issue of deforestation, around the issue of climate?
We are highly committed to reduce our carbon emissions, which of course impacts biodiversity. Second is that we've worked hard just in our strategy, as you know, to become a digital player. We are using, yes, less and less physical products like paper, and that continues going forward. Finally, we do community outreach in many areas in the world where we are in fact focused on planting trees. We do that in the Chicago area. We also do that in the Paris area through our employees. A lot of our community-based activities is employee-led, based on their specific passions and their missions. We feel that we are making our part. We are doing our part in the effort to reduce climate change issues.
I'm missing something. All the companies in the Netherlands have a great sustainability program.
However, a forest the size of twice the size of the Netherlands or three times the size of the Netherlands disappears every year. That's an enormous threat for your business and the business and the shares of all the shareholders. What goes wrong? Everyone is saying very proud I'm working on sustainability, but in fact, we're losing 600,000 plants and animals on a worldwide basis. Something is wrong. There is a certain leak because when everybody's saying to each other, we're doing a great job, we are very sustainable, but in the meantime, all these species disappear. Something's going wrong, and the top of the pyramid has to work much, much harder. Ask your children or grandchildren. Ask them, this is the issue. We're losing twice the forest worldwide of the Netherlands. Do you feel that we're making good progress on sustainability?
That is just an example. Look at the North Pole, look at the South Pole, look at all the mountains, all the glaciers. Everything is disappearing. You, as the top of the pyramid, with your network, can do something about it. That is my advice to you because we are running out of time. What we are investing is pennywise but not pound foolish. It does not help that we have a CEO of the world in America who gets a new airplane from Qatar. This is a real madhouse, what is going on. The intellectual heart of Wolters Kluwer can help to make some changes. I invite you to make some changes altogether because we are running out of time.
I can assure you that the Supervisory Board is fully supportive of management's efforts in sustainability, and we thank you for your thoughts and commentary.
Okay, thank you.
Are there any other questions? Thank you. I kindly request you to prepare for the first voting item. Make sure that you are connected to the voting platform or otherwise, please raise your hand for assistance. Before we proceed, I will pass on the notary's formal observations, which are, according to the registration list, shareholders are present or represented who can cast 178,799,596 votes, representing 76.69% of the issued and outstanding share capital at the meeting. Before the meeting, shareholders submitted a total of 178,798,464 votes to the notary by proxy. May I ask the operator to open the voting system for agenda item 2C? Voting is now open. Voting is now closed. I am pleased to report that agenda item 2C received a majority vote of 92.86%. Thank you.
May I ask the operator to open the voting system for agenda item 3A, the adoption of the 2024 financial statements? Voting is now open. Voting is now closed. I am pleased to report that agenda item 3A has passed with 99.9% of the vote. Thank you. I propose we now proceed to the next set of agenda items. Item 3B, explanation of dividend policy, and item 3C, the proposal to distribute a total dividend of EUR 2.33 per ordinary share, resulting in a final dividend of EUR 1.50 per ordinary share. I will describe the company's progressive dividend policy. Wolters Kluwer aims to pay a higher dividend per share in euros each year compared to the prior year. The annual increase depends on factors such as our financial performance, market conditions, and our need for financial flexibility.
It is also part of our policy to pay an interim dividend after the first six months of each year. As in prior years, the Supervisory Board has carefully reviewed the financial situation of the company and capital allocation and feels confident that the proposed dividend is appropriate. I also refer to the earlier presentation of Nancy McKinstry in this respect. In line with the progressive dividend policy, we propose a total cash dividend of EUR 2.33 per ordinary share to be paid for the full financial year 2024, which represents an increase of 12% over the prior year. Since an interim dividend of EUR 0.83 per share was already paid in September 2024, the final dividend payable in June will amount to EUR 1.50 per share.
Upon your approval of the dividend proposal for 2024, this will be the 19th consecutive year in which the company has increased its dividend per share in euros under its progressive dividend policy. As in prior years, we intend to set the interim dividend for 2025 payable in September at 40% of the prior year's total dividend. Are there any questions on these agenda items? With no questions, I'd like to ask the operator to open the voting system for agenda item 3C. Voting is now open. Voting is closed. I am pleased to report that agenda item 3C has passed with 99.91% votes in favor. Thank you. I would now like to move to agenda item four. The proposals to release the members of the Executive Board and the members of the Supervisory Board from liability are separate agenda items and will be voted on separately.
However, I will deal with questions on item 4A and 4B together. Are there any questions on these items? May I ask the operator to open the voting system for agenda item 4A, the proposal to release the members of the Executive Board for the exercise of their duties? Voting is now open. Voting is closed. I am pleased to report that agenda item 4A has passed with 96.77% approval. Thank you. May I ask the operator to open the voting system for agenda item 4B, the release of liability for members of the Supervisory Board? Voting is now open. Voting is closed. I am pleased to report that agenda item 4B has passed with a vote of 96.78% in favor. I will now move to agenda item 5. The third four-year term of the company's CFO, Mr. Entricken, will expire after this AGM.
The Supervisory Board is pleased to nominate Mr. Entricken for another term of four years, considering his deep knowledge and extensive experience in financial and economic aspects of international business and the successful way in which he has fulfilled his role as Chief Financial Officer. Further information on Mr. Entricken's background is provided to you in the explanatory notes on the agenda. His more detailed bio, in addition to a summary of the main elements of his agreement, was also made available in the meeting materials. Are there any questions? With no questions, I would now like to proceed to the vote on agenda item 5A. May I ask the operator to please open the voting system for agenda item 5A? Voting is open. Voting is closed. I am pleased to report that agenda item 5A has passed with a vote of 99.99% in favor. Congratulations, Kevin.
I would now like to move to agenda item 5B. Tough bar there, Kevin. Agenda item 5B is the appointment of Ms. Stacey Caywood as a member of the Executive Board. As explained in the agenda, Ms. McKinstry will retire as CEO and Chair of the Executive Board in February 2026. The Supervisory Board is happy to nominate Ms. Stacey Caywood as a member of the Executive Board for a period of four years effective after this meeting. The Supervisory Board intends to subsequently appoint Ms. Caywood as Chair of the Executive Board and CEO as of February 2026, after the retirement of Ms. McKinstry. As explained in the agenda, Ms. Caywood is a seasoned executive with extensive global experience. She has successfully led two of Wolters Kluwer's largest divisions, Wolters Kluwer Health and Legal and Regulatory. The Supervisory Board has a strong conviction and full confidence that Ms.
Caywood is the right person to lead Wolters Kluwer in the coming years. Further information on the background of Ms. Caywood was provided to you in the explanatory notes to the agenda. Her more detailed bio, as well as a summary of the main elements of her agreement, was also made available in the meeting materials. First, I kindly invite Ms. Caywood to give a brief introduction to the AGM. Stacey.
Thank you, Ann. It is such an honor to be nominated to join the Executive Board of Wolters Kluwer and to succeed Nancy as CEO when she retires next year. I'm grateful to the Supervisory Board for your trust and support in me to continue the legacy of visionary and effective leadership that has made Wolters Kluwer so successful. It goes without saying that Nancy has had a truly remarkable tenure at Wolters Kluwer.
She has led a complete transformation of our company, having set out a clear strategic vision. Importantly, she has built a strong team around her to execute the plan, which has created significant value for customers, employees, and shareholders. We are today in a very strong, growing, and healthy position with great talent around the world and the financial strength to continue investing for the future and to continue supporting our customers in their critical decision-making. Throughout my career, I have been fortunate to work closely with Nancy and have seen and experienced her incredible leadership and dedication firsthand. My experience at Wolters Kluwer as CEO of the Legal and Regulatory Division and currently as CEO of the Health Division have allowed me to build a really solid understanding of our global customer segments and the technology-enabled solutions that we provide.
Throughout my tenure, I have been deeply involved in product development, always seeking to deploy the latest technology, including artificial intelligence, for the benefit of customers. Recently, I worked closely with Nancy, Kevin, and the wider leadership team to develop the three-year strategic plan that was presented in February. I am excited about the opportunities for all of our divisions as we begin to execute on the plan. Over the coming years, my focus will be on driving profitable growth through consistent investment in innovation that delivers value to our customers. I sincerely appreciate your support, and you have my full commitment that I will focus on creating long-term sustainable value for all of our stakeholders. Thank you.
Thank you, Stacey. Are there any questions in relation to the appointment of Ms. Caywood?
What's important? Good. Thank you for your fishing on certain things.
What's important is continuity for shareholders and stakeholders in the coming five to ten years. I've given my perspective on sustainability, and I would like to have your perspective on the things I was saying. What is more important, even, is what is your opinion about cybercrime? Chinese and Russian hackers are making a spearhead activity of ruining our economy. What is also important, and you saw that with the power outage in Spain, is that the entire business of Wolters Kluwer can continue to operate independently and sustainably. Pickups of all systems worldwide, and important batteries, generators, sun and windmills altogether. That is a chain responsibility. You see that in the field of sustainability as well as in the field of cybercrime. That is a huge threat for shareholders and stakeholders.
We have to improve that in my view, and perhaps you have the coming five to ten years to work on this wonderful challenge. I would like to hear your opinion about it. Yeah, it's quite a serious problem for here, for us as the shareholders, because it's increasing all the time, but suddenly you can have a sudden death, and we don't want that.
The Supervisory Board would agree with you completely that cybersecurity is a very important topic for Wolters Kluwer. We get reports from the Management Board regularly on our cyber capabilities. Even part of the compensation system, as you saw in the earlier presentation, is based on the company's continuing to stay, continuing to move ahead in terms of cybersecurity. We've had third parties come and talk to us about Wolters Kluwer's capabilities in cybersecurity. It is something that we're very focused on.
We continue to make progress on it, but we also continue to think we're doing a very reasonable job.
Oh, you're doing a reasonable job. But organized crime, with the backup of China and Russia, has much more budgets to ruin our system. We have to try harder.
We understand, and we try very hard. I understand that there are people with many more resources than we have. There's not a lot that we can do about that, but we appreciate your concern, and thank you.
Okay, thank you.
Are there any other questions? Okay, may I ask that the operator open the voting system for agenda item 5B, the appointment of Ms. Caywood as a member of the Executive Board? Voting is open. Voting is closed. I'm pleased to announce that Stacey's been elected as a member of the Executive Board with a 99.96%. Welcome.
Okay, I would now like to ask our Vice Chair, Mr. Jack de Kreij, to handle agenda item six, which deals with my reappointment as a member of the Supervisory Board.
Thank you, Ann. I'm more than pleased to handle this item. As explained in the agenda, the second four-year term of Ms. Ziegler expires after this AGM. The Supervisory Board had a very thorough discussion on her reappointment, in which we also considered, amongst others, the outcome of our annual Supervisory Board assessment. The result of this discussion was that all Supervisory Board members fully support the reappointment, first and foremost due to the constructive and professional way in which Ann fulfills her role as Chair of our Board. In addition, the Supervisory Board considered her extensive executive and non-executive experience, as well as her commitment, valuable contributions, and knowledge of technology solutions.
With that, she continues to fit very well the profile of the Supervisory Board. Further information on the background of Ms. Ziegler was provided to you in the explanatory notes to the agenda and a more detailed bio of Ann, which was also included in the meeting materials. In line with the Dutch Corporate Governance Code, after having completed two terms of four years, the reappointment will be for a period of two years. I would like now to open for questions on agenda item six, the proposal to reappoint Ms. Ziegler as a member of the Supervisory Board. Are there any questions at this stage? If not, may I ask the operator to open the voting system for agenda item six, the reappointment of Ms. Ziegler? The voting is now open. The voting is now closed.
I'm very pleased to report that agenda item 6 passed with 98.11% in favor of reappointment of Ann Ziegler as a member of the Supervisory Board. Congratulations, Ann. Back to you.
Thank you, Jack. I would now like to give the floor to Ms. Kirsten again, the Chair of our Selection and Remuneration Committee dealing with remuneration matters, who will give a presentation on the new remuneration policy of the Executive Board. Heleen?
Thank you, Ann. I would like to summarize agenda item 7, which is the proposal to adopt the updated remuneration policy for the members of the Executive Board. Under the Dutch Corporate Governance Code, the Executive Board remuneration policy is put before shareholders every four years. We took this opportunity to review the policy, analyze current market practice, and gather shareholder feedback. The Supervisory Board engaged widely.
We had meetings with more than 40 shareholders last year. The company also engaged with other stakeholders to ensure shareholder and societal acceptance. As a result of that exercise, we are now proposing a relatively modest change, which is to lower the weighting of the TSR measure from 50% to 30% and to raise the weighting of the EPS growth measure from 30% to 50%. All other aspects of the policy remain unchanged. You can see a summary of the main elements on this slide. We also took the opportunity to streamline the policy document to make it more concise and to clarify some aspects. Subject to adoption today, the remuneration policy will take retroactive effect from January 1, 2025, and is intended to remain in place for four years. The change in LTIP weightings will start with the next LTIP plan starting in 2026.
With that, I hand back to the Chair, and I'm happy to answer any questions you may have about this agenda item seven.
Are there any questions on this agenda item? May I ask the operator to open the voting system for agenda item seven, the remuneration policy of the Executive Board? Voting is now open. Voting is now closed. I am pleased to report that agenda item seven received 95.37% of the votes in favor. As such, the quorum of 75% of the agenda item was met. Moving on, I would now like to discuss agenda items eight, nine, and 10 together. These are the authorizations given the Executive Board that return to the agenda each year.
Under agenda item 8A, it is proposed to extend the Executive Board's authority to issue shares and/or grant rights to subscribe for shares for 18 months as of today, up to a maximum of 10% of the share capital issued as of today. Agenda item 8B concerns the proposal to extend the Executive Board's authority to restrict or exclude the preemptive rights of holders of ordinary shares for 18 months as of today, up to a maximum of 10% of the share capital issued as of today. Under agenda item nine, it is proposed that the Executive Board will be authorized for 18 months to acquire shares in the company up to a maximum of 10% of the share capital issued as of today on the stock exchange or otherwise.
Agenda item 10 requests a resolution for the Executive Board, if it so wishes, to cancel the ordinary shares in the company's share capital that the company has purchased or will purchase on the basis of agenda item nine. The precise wording of the resolutions can be found in the agenda with its accompanying explanatory notes. I would now like to see if there are any questions on agenda items eight, nine, or 10. I believe we do have some pre-submitted questions. Again, I'll turn to Meg Geldens to ask those questions.
Yes, we do. We have questions from the VEB, and I'll read them out together because they're both financially oriented. Historically, Wolters Kluwer maintained that net debt to EBITDA ratio of approximately 2.5x was appropriate, but you recently updated that to a long-term target range of 1.5x-2.5x .
What considerations led to this revised target range for net debt to EBITDA? Does it tell us anything about a change in your risk appetite? Second question is, given that one of your peers has recently increased their share buyback, has Wolters Kluwer evaluated a similar increase in the buyback program, currently EUR 1 billion? Would you increase it from here? If not, what are your capital allocation priorities? Which priorities take precedence to increasing the buyback?
Kevin?
Certainly. Yes, we have updated our net debt to EBITDA target from around 2.5x to now 1.5x-2.5x . That really reflects the reality of where we have been over the last decade. If you look from 2011 through most recently the first quarter, we have been between 1.3x and 2.4x , so nicely within that range.
We're currently at the 1.7x , which is also nicely in that range. I would say that our risk appetite really hasn't changed in making this adjustment, but what has changed is our business. The strength of our portfolio has only increased over this period. We've also seen stronger EBITDA, stronger cash flows over this period. We do believe that this range of net debt to EBITDA that we're guiding you to allows us the appropriate flexibility to achieve our strategic goals and still maintain a very strong balance sheet. Your second question on the share buyback, we are currently executing a share buyback of about EUR 1 billion this year. We've successfully done about a third of that through today. We will continue on that share buyback program. With regard to changing that amount right now, I would say we're really committed to that billion.
I would remind everybody that earlier in the year, we announced the acquisition of RASi in our FCC division, and the purchase price there was about $415 million . With that capital allocation outlay, as well as our continued share buyback program, I think the billion is the right place. With regard to allocation of capital, we are always looking to strike the right balance between investing in the business, either through organic investments or smaller bolt-on acquisitions, paying down debt, and rewarding our shareholders with the buyback program and with the dividends. That has not changed, and we will continue to look to hit the right balance in that regard.
Thank you. Are there any questions on these agenda items of shareholders in the room? There being no questions, may I ask the operator to open the voting system for agenda item 8A?
Voting is now open. Voting is now closed. I am pleased to report that agenda item 8A has passed with a vote of 97.91% in favor. May I ask the operator to open the voting system for agenda item 8B, the proposal to extend the authority of the Executive Board to restrict or exclude statutory preemptive rights? Voting is now open. Voting is now closed. I am pleased to report that agenda item 8B has passed with a vote of 97.4% in favor. May I ask the operator to please open the voting system for agenda item 9, the proposal to authorize the Executive Board to acquire shares in the company? Voting is now open. Voting is now closed. I am pleased to report that agenda item 9 has passed with a vote of 99.05% in favor.
May I ask the operator to please open the voting system for agenda item 10? Voting is now open. Voting is now closed. I am pleased to report that agenda item 10, the proposal to cancel shares, has passed with a vote of 99.56% in favor. I now turn to our final agenda item. In 2023, the AGM appointed KPMG as auditor for the financial years 2025 up to and including 2028 after an extensive RFP process. The recent draft implementation of the EU Corporate Sustainability Reporting Directive states that the AGM should also formally appoint the auditor who examines the sustainability statements and provides limited assurance. In anticipation of this legislation, the Supervisory Board recommends to appoint KPMG Accountants for engagement for the sustainability statements. Are there questions on this agenda item?
As there are no questions, I'd like to ask the operator to open the voting system for agenda item 11. Voting is now open. Voting is now closed. I am pleased to report that agenda item 11 has passed with a vote of 99.92% in favor. We have now concluded the last voting item. Before concluding the meeting, I would briefly like to say something about the upcoming retirement of Ms. McKinstry. Because Ms. McKinstry will stay on as CEO until February 2026, it is too early to say goodbye. She is fully committed to a smooth transition of her responsibilities to Ms. Caywood. However, because this is Nancy's last AGM, I would briefly like to express the gratitude of the Supervisory Board for her leadership of Wolters Kluwer over the last 22 years.
Her unwavering dedication, visionary leadership, and tireless efforts have been instrumental in shaping the future of Wolters Kluwer. Nancy's commitment to excellence and her ability to inspire those around her have left an indelible mark on the company. Under her leadership, Wolters Kluwer has thrived and flourished as never before. Nancy has very successfully led and transitioned the company to a digital expert solutions provider. The company's market capitalization has increased tenfold under her leadership. We are profoundly grateful for her contributions and the positive impact she has made. Nancy's legacy will continue to inspire us all, especially the employees who have greatly benefited from her vision, guidance, and motivation. Nancy, the first of many thank yous on behalf of all of us.
Thank you.
Before closing, I would like to ask whether anybody has any final questions for any other business. I see that there are no final questions.
Thank you for your attendance and participation today, and I now close the meeting.