Dear shareholders, dear employees, ladies and gentlemen, On behalf of the Board of Directors and the Executive Committee, let me bid a cordial welcome to you to the Annual General Meeting of Lafarge Holzheim today. I would also like to welcome our shareholders following us through our webcast. Your presence and participation in the AGM today is important, and it means a great deal to the Board of Directors, our management and our employees. I am also pleased that the members of the Board of Directors and the Executive Committee are present here in full today. 2 of them will be the persons we're going to highlight on.
As we have announced already, Mr. Thomas Schmidt, Heiney and Mr. Bertrand Colland will step down after many years of committed to successful work as directors of Holcim and Lafarge or Lafarge Holcim and will not stand for reelection. Both of them have been crucial in building up Holcim or Lafarge and have made seminal contributions to making sure that the merger between Holcim and Lafarge was completed and implemented successfully. In the course of my statements and 1st and foremost, in the official part of the meeting, I will get back to talking about their extraordinary merits for the benefits of our company.
But first, let me present to you my colleagues on the podium with me today who will support me in providing reports about the financial year and in answering your questions and generally completing the Annual General Meeting. Let me begin over on the right hand side with Geraldine Picot, our new Chief Financial Officer. Then I would like to, of course, welcome Mr. Jan Jens, our Chief Executive Officer, who will review the 2017 financial year and explain to you the new strategy of the company under the heading of Building for Growth. Over on the left hand side, we've got Dragana Semyonovich, the Secretary of the Board of Directors as well as Oskar Van Holl, our Vice Chairman.
Before going into the details of reporting on the financial year, let me make some housekeeping remarks. If you wish to follow the Annual General Meeting in English, you will have chosen Channel 2 for English. For French, tune to Channel 3. And if you wish to follow the presentations in German, please choose Channel 1 on your headset. To be as efficient as possible in our proceedings, We have set up a speakers' desk for all shareholders who wish to take the floor on one of the items.
The speakers' desks is located on the left hand side of the stage, and there are employees of Lafarge Holzheim who will take care of you. Please indicate the item you wish to speak on there, and I will then call you when that item comes up. And I will ask you to ask your questions or make your comments. Finally, let me point out that health and safety are a top priority for us. This also applies at the annual to the Annual General Meeting today.
Please have a look around and take note of the nearest emergency exit. Emergency exits are marked in green. Now in the unlikely event that we have to evacuate the building, you are asked to follow staff instructions. A call for evacuation would be given by either myself or one of my colleagues on the stage. Following these introductory remarks and housekeeping matters, let me now report on the development your company took in the year under review.
2.5 years following the merger, Lafarge Holt Sim is a market leader in global cement and building materials industry, and the stamp has established itself as such. Last year, made a significant contribution to this. In summary, it is with great satisfaction that I take note that our company is growing again and its profitability, as measured by EBITDA and earnings per share, was reinforced last but at least on the basis of the synergies that we announced and have tapped into. And we've also managed to further reduce debt. So by and large, Lafarge Holzim, for the first time since the merger, is back to having entrepreneurial leeway that is required to drive ahead this business in a sustainable manner.
Now we have investigated the revaluation of the portfolio, but this doesn't change anything. On the contrary, it has led to a loss that is however, has no impact on cash, a loss in the 2017 annual financial statements. But with this revaluation, we've created the basis to enter the next phase of development of LafargeHolzheim free from any legacy issues. The Board of Directors thus proposes to you, ladies and gentlemen, payout of a dividend that remains unchanged compared to the previous year, a dividend of CHF2 per share to be approved by you. And the Board of Directors is doing this, convinced that with the new 2022 strategy, we will be consistently tapping into the market opportunities in the global building materials market that is, again, growing more rapidly and to further reinforce our market leadership.
It is the objective, the 2022 strategy to drive ahead sales in the next few years, sales and growth in the next few years to simplify the business and to produce appealing added value to all stakeholders, which we want to achieve by means of 4 value drivers, I. E, by growth, simplification and performance, the right use of capital and by implementation of our cultural values at Lafarge Polsim. In order to better benefit from growth in the Building Materials segment, we are first going to use our capital in the most appealing markets. Specifically, also with regard to investment, we are going to focus on markets presenting the greatest potential for growth. And we want to tap into this by means of organic growth as well as bolt on acquisitions.
The three fields of cement aggregates and ready mix concrete are to be complemented by the Solutions and Products units as a 4th segment of business. And this segment is probably going to benefit most from developments in the construction sector. It includes ready mix concrete components, concrete products, asphalt and mortar and is already generating sales of CHF2.1 billion today. And we assume that this strong segment for the benefit of value creation will become a significant value driver in and growth driver in Established Markets. And Jan Jens is going to go into the details of this in a minute.
Secondly, we want LafargeHolcim to be an agile, lean and cost disciplined business with performance driven management. Our focus will primarily be on countries with local markets becoming more independent and interfaces with the corporation being reduced. This is the way we want to get more customer proximity, and we expect of this strategic realignment for the business to be enabled to react to opportunities and changes in the markets faster and to better identify growth potential. Thirdly, we're going to ensure maintenance of investment grade ratings by the disciplined value creation And where we identify valuation gaps, we are going to finance growth by selling off certain assets. Following maintenance and growth investments, the remaining free cash flow will be used to pay out an appealing dividend.
Finally, the Board of Directors and the Executive Committee are pursuing a clearly defined culture of values to which every employee is going to be committed no matter what their function or position and which will be supported by everyone. I am talking about predictability and reliability with which to manage this business. And I am speaking of honesty, transparency and openness to employees as well as customers, business partners, investors and shareholders. These are the values that will drive the culture of a company and that create the necessary trust required for every successful business. Our strategy for sustainability and social responsibility are closely related to our cultural values.
It is our objective with regard to carbon intensity to play the leading role in our industry so as to achieve our long term ecological objectives. Let me give you a case in point. A good example of how Lafarge Holzim is meeting its social obligations. That is our foundation for sustainable building. Lafarge holds him foundation that focuses on the significant role of architectures, engineers, city planning and the construction industry when it comes to achieving a more sustainable future.
The foundation is legally independent of Lafarge Holzim and receives financial and organizational support. It is managed by Rob Soirend, the former Chairman of the Board of Holzim. And at this point, I would like to thank him for his great commitment he's shown ever since the foundation was established in 2003. The International LafargeHolzheim Awards for sustainable construction have become the most significant global contest for sustainable construction under the management of the foundation. The awards are meant for innovative projects and ideas that will be used in future construction projects.
To win an award, an initiative has to be marked by ecological and social responsibility. This combined with a potential for economic growth and it's got to stand out for architectural quality. The foundation is a case in part showing how LafargeHolcim as a globally leading supplier of building materials can drive ahead sustainable solutions for workers, building owners, architects and engineers or in other words, the entire value chain from planning to execution and this at global level. To give you an example of such solutions, let me refer to construction of the new international airport in Mexico City. This is a project managed by architects Lord Foster and Fernando Romero, which is to produce the most sustainable airport around the world with a traffic volume of up to 80,000,000 passengers.
Now in the construction of this gigantic airport, we can see reflected our convictions and skills that our company stands out for, I. E, sustainability, leading engineering capabilities, a high degree of innovation and last but not least, true customer proximity. The construction started in July 2017, and we are supplying environmentally friendly high performance concrete, which we developed in our Mexican Technology Center in cooperation with our global research center based in Lyon. Now in the construction of the Mexico City Airport, we can rely on great experience we have acquired in a number of outstanding airport construction projects that Lafarge holds him as being involved in. Among the most recent projects, we have the Airport in Saudi Arabia as well as the Rabat Saleh Airport in Morocco.
Over and beyond that, we are going to cooperate with the China Communications Construction Company on the expansion of the international airport in Entebbe, Uganda. As you can well imagine, esteemed shareholders, such highly complex projects in different regions of the world in terms of politics and culture. And we have the highest degree of requirements placed not only on our skills and organization and environmental competence, but also in our reliability, predictability and integrity. In global competition, these values play and they are particularly significant to public contractors. The quality of our corporate governance and compliance, that is to say the guidelines of good ethical and correct business management, thus, is crucial for our business success.
And there cannot be any compromising in this regard. Unfortunately, this principle has not always been upheld consistently in the past. As you are certainly aware, this has led to unacceptable misconduct in association to the then Syria are currently being investigated by French legal authorities. Fundamentally, we're talking about an investigation into allegations of support provided to terrorist groups that were made public in the course of 2016 and relate to Lafarge assays activities in the Syria plant in the period between 201220 14. I extensively reported on this last year.
So let me simply confine myself to saying that Lafarge Holzheim is fully supporting the French legal authorities and has gone to great lengths and done everything in its power to facilitate comprehensive fact finding to the French authorities. We have also referred to the French authorities and the media on several occasions that we absolutely regret the events in Syria and condemn them. And in order to make sure that such things can no longer occur, the Board of Directors of LafargeHolcim decided to set up a new Ethics, Integrity and Risk Committee. This committee is to review strict implementation of measures initiated and compliance at corporate level because, dear shareholders, we are very clear about one thing. Misconduct as shown in Syria must not be repeated again ever again at LafargeHolcim.
And it is in this context that I would clearly want to emphasize once more that the Board of Directors and every single member of the Board of Directors wants to consistently pursue a deeply entrenched corporate governance and compliance culture and demands this from every employee. I have been working with my colleagues long enough to be able to ensure that we are not making any compromises in this regard. Our companies always have and have robust processes to avoid violation of the rules of conduct. Now if individuals do not play by the rules, then this, of course, is objectionable and needs to be investigated consistently. We have launched such investigations consistently and have always been transparent in conducting them and in submitting the outcomes and results to the French authorities.
Now following these statements on the case of Syria and our efforts with regard to compliance in recent months, let me turn to a different but related subject matter that has kept us on our toes in recent months. It is corporate responsibility to the environment and society. I have just talked about Syria and how we have learned our lessons from the case and how our company is facing up to its responsibility. Now in Switzerland, an initiative has been launched that would mean that or that says that companies are violating against human rights and environmental standards on purpose. And I'm talking about the corporate responsibility initiative that wants to make sure that companies can be sued for violations against human rights and environmental standards no matter where those violations occurred in the world or no matter whether it occurred in the company itself or with a subcontractor.
Now while we recognize the fundamental cause of the initiative to better protect human rights and the environment around the world, but the demands made by those who launch the initiative are going far too far when it comes to due diligence and liability rules. Of course, companies have a responsibility to bear when it comes to protecting man and the environment. And this responsibility is not allowed to us as companies have an interest, a business interest and incentive to respect human rights and the protection of the environment. Companies with higher social and ecological standards are more trustworthy when it comes to appearing in the market. It presents benefits over the competition and improved conditions at work, increased productivity, simplify the process of recruiting employees and facilitate cooperation with authorities and the population at large.
However, this initiative is designed to somehow juridify corporate social responsibility and to undermine responsible behavior of companies and on a spontaneous basis. If it was approved, it would lead to an unheard of obligation of monitoring and Switzerland is not an island. There is no similar there are no similar rules on 3rd party liability under any other jurisdiction and this would have a competitiveness and it would put at risk prosperity in this country. So let's stick to the constructive path of cooperation that we have embarked on. Cooperation is more successful than court cases.
And a law as proposed by the initiative would not have prevented such occurrences as in Syria. We can only prevent such events if we are conscious and responsible and driven by values of a 0 tolerance culture when it comes to violating our values. Esteemed shareholders. Let me also take a quick glance into the future. I'm confident the global buildings, building materials market shows growth of 2% to 3% per annum and thus gratifying momentum, which means a great deal of opportunity for our own growth.
This is all attributable to the need for higher quality of life and more high performing infrastructure, increasing digitalization of the value chain in the construction industry where our industry certainly has a lot to catch up yet and the necessity of developing sustainable construction solutions. Our success, however, is also based on our long standing business activity on a global level, which makes us unique when compared to our competitors. At the same time, we're a local business. We are close to our clients, and we make significant contributions to the municipalities we work in. All these factors will continue to drive ahead LafargeHolcim and to bring about growth for it.
With our strategy, we will be in a position to turn this growth into continuous increase of LafargeHolcim's corporate value, thus creating added value also for you as shareholders, ladies and gentlemen. In conclusion, let me thank my colleagues on the Board of Directors for their great commitment also in terms of time they put in. Lafarge Holzim has a highly competent Board of Directors and benefits from the variety of experience and nationalities represented on the Board. Let me, in particular, extend a special word of gratitude on behalf of the Board of Directors to all our employees for their high degree of commitment. Yes, go ahead.
Well, this is well deserved, well deserved hand. And my highest personal cause and believe you me is that our employees We'll tell all their next of kin and in particularly their children with great pride that they are working for LafargeHolcim. And last but not least, we owe a word of gratitude to you, dear shareholders, for your support and your trust in the vision of LafargeHolcim is very important for everyone working to implement it, and it's highly encouraging. Let me now pass on the floor to Jan Jens, our Chief Executive Officer, who will provide you the details of our performance in 2017 and in the Q1 of 2018 and will explain to you the 2022 growth strategy in more detail. Thank you very much for your attention.
Jan, over to you, please.
Ladies and gentlemen, dear shareholders, it's a great pleasure indeed for me to be standing here for the first time at an AGM of La FargeHolzen. Before I share information with you on the results of 2017 at the New Strategy 2020 and the course of business in this year, I'd like to share my first impressions that I've had in my new function at LafargeHolcim. I started out in September. And since then, I've been traveling a lot to get to know the company. I visited many of our key markets.
I talked to countless team members. I met the team leaders. And so far, I've gotten quite a good impression on how we work on a daily basis and how we work together with vendors and clients and of how we do business. I mean, you will easily concur with me that we're distributed globally. We have more than 22 cement orgs.
We have 650 sand and gravel sites and more than 1,000 and 400 ready mix sites. We're a highly global whilst decentralized company. I'm very happy that I've been able to visit some of these sites. I also visited many clients and talked to great number of our affiliates. And together with my team, I started out developing our new strategy.
And I can tell you, you have a great company here. If you look at the quality of our sites, if you consider the competence, the commitment of our team members, we can indeed say with pride that we're greatly positioned. I have not yet met a company in construction industries that is so close to their clients and that work with great dedication and commitment for their good. And that makes me highly confident with regard to our future. Over the past two and a half years, we focused on the merger issues.
Quite a long time that was, and I suppose you would agree with me that we may have spent a bit too much time on that. Now, however, we can look into the future with confidence after having successfully completed the merger. As was reported by the Chairman of the Board, we were successful in our merger as we have reached all our targets with regard to synergies. The merger, however, goes further than just tapping into synergy and cost goals. The country positions that we now have and hold are the very best of the merger.
Thanks to the merger, we are present in 54 countries with our own cement sites. And we generally have a number 1 or at least number 2 position in those countries. This was only possible thanks to the merger. A couple of examples perhaps. In the United States, in Northern America, we have a LafargeHolcim leading position.
United States, it was Lafarge. In Canada, it was Holcim. And together now, we are strong number 1 in North America with sales of more than €6,000,000,000 The same is true also for many European markets. Lafarge was very strong market leader in France. Holcim was market leader in Switzerland.
And similar things can be said about Eastern Europe, where Lafarge was strong in Poland. Holzim was strong in Romania and Russia, say. Turning our eyes to Asia. We also complement one another well there. We had leading positions by Holcim in Indonesia and the Philippines.
Lafarge, on the other hand, was very strong in Malaysia. And I'm very proud indeed that we created such a sound franchise with leading positions in most of the markets where we're active. This is the right time now, after having concluded the merger, to turn our eyes to our growth strategy 2022, we have switched the throw to the switch to growth and profits. The Chairman of the Board already mentioned the 4 pillars on which our strategy rests. And the Chairman also mentioned the excellent market opportunities in the Buildings Materials segment.
This is what makes us confident. First, however, I'd like to turn to the results that we achieved in 2017. In 2017, we achieved excellent results. You see sales growth of almost 5%. Also with regard to the operating results, a plus of 6%.
Earnings per share, we're gratifying, too. Free cash flow is not where it should be, even though we've inched ahead. But what we see here is a solid foundation for further progress, particularly given the fact that our results are very broad based. Contributions came from all regions. In 4 out of 5 regions, we've made advances.
The Northern America had gratifying growth as regards to operating results. The same was true in Latin America, Middle East, Africa and Europe. In Asia, though, we've had a few issues given the headwind and competitive pressure that we faced. So our results are very broad based, contributions from everywhere, which prepares us well for the new strategy 2022. Let's now turn our eyes to the strategy that I'd like to explain in a bit greater detail so you know where we're headed.
These are the 4 pillars that you heard before heard about before: growth, simplification and performance, financial strength and vision and people. Over the next few minutes, I'd like to talk about this in a bit greater detail. We already said with regard to growth that in a growing building materials markets, we want to step on the accelerator to achieve above average growth. At the same time, we want to simplify our organization, decentralizing, giving more responsibilities to the regions, financial strength, also thanks to a strong dividend policy and a high cost discipline in with regard to investment.
At the
heart of our activity are people. Here, we would like to make sure that more responsibilities are delegated to the countries. We have already simplified our organizational structure to the extent that our main markets, the biggest 35 countries, reporting directly to group management to make sure that decisions can be reached fast. Country managers, therefore, and their teams have to take on a lot of responsibility. The most important aspect here, though, is that everyone returns home safely from work.
A lot remains to be done here. Health and safety has been lifted to the level of a group target over the past 2 years. And this is a course we will hold on to. We've achieved some progress in 2017. There were fewer accidents in our sites than in our delivery services, but we're clearly far from the objectives we set ourselves.
You can rest assured group management and the board will be doing their very best to make sure that health and safety be further improved at LafargeHolcen. I'd like to talk about growth a bit more. The Chairman of the Board said it, we observe excellent trends in the buildings materials markets. You can also observe them in Switzerland. A lot of construction is underway.
This can be seen also globally, thanks to the demographic pressure makes it necessary for more buildings to be erected, but also more infrastructural building is happening, tunnels, bridges, etcetera. The demographic growth is happening in cities. The trend of urbanization is a very positive one for us, LafargeHolcim, because if you build cities, you need to use LafargeHolcim products much more so than if you were building in rural areas. This is true, obviously, with regard to high rises, tunnel structures, but also infrastructure, sewage plants, hospitals, airports, SENSO-one and so forth. We also have higher quality standards worldwide.
There is a trend towards more healthy living, towards high quality living. And this is also a main driver for growth in our industry. We're very optimistic that in years ahead, the construction markets will be growing over above average and open up opportunities for us. How do we want to tap into these opportunities? Well, the next slide shows our strategy of how we want to grow.
We got all of our managers on board asking them to help develop common growth strategies, which helps us find us where we have to invest, where we have to find outlets for concrete and cement, where we develop new solutions with our clients. And the new business segment, solutions and products, is what should take us closer to clients. Here, we produce prefabricated products, but also mortar and asphalt products. We need to be closer to our clients, particularly in that segment, which will help us grow. The Chairman of the Board said it before, we want to approach smaller market participants, SMEs and family office family companies taking them over in order to position ourselves better in certain markets.
1 first such acquisition was carried out in the UK where the Kendall family company was taken over in February, paying a price of €35,000,000 for that. We have targeted investment plans in growth markets that are growing very strongly in DSA. In February, we announced that we would be building a new plant to cover the growing demand for cement. Well then, let's shed some light on the pillar simplification and performance. We want to develop a slimmer organizational model.
I already talked about simplification before. We cut out one hierarchical level. Country managers now report directly to the group management. We've also simplified group functions. We used to have 2 so called business functions in group management that we put together to simplify things and also interfaces to countries have been reduced in number.
This all of this makes it easier for us to work with one another and to improve the group as a whole. We also launched a cost initiative to the tune of CHF 400,000,000 at global, regional and country level, thanks to simplification measures, more than CHF 400,000,000 will be taken out of our cost. And as one component, we already mentioned that group locations in Singapore and Miami be closed by mid-twenty 18. We're going to empower the individual business segments there are still gaps that we need to close to our peers in certain markets, and we're aiming to close them. With this, I'd like to get to our 3rd pillar, financial strength.
Of course, we want to use our money wisely, holding on to our dividend policy trends and also making sure that we hold on to our investment grade credit rating. We're a solid company that banks love to provide loans to. This is something we want to hold on to. We've also reduced our leverage, our exposure, and we will continue to do so. This slide shows the goals for Strategy 2022.
We want to grow to the tune of 3% to 5% in existing and growing building markets. We want to increase our recurring EBITDA by at least 5% every year. Free cash flow is to be increased to more than 40% of our operating results. We're only at 28% here. But we're quite optimistic that measures we have already taken will soon lead to better results.
Return on invested capital is to be increased as well. We're at just about below 6%. And in the medium term, we want to be above 8%, making us a lot more attractive for our shareholders. Well, ladies and gentlemen, with that, let's look at the course of business. In 2018, we started out well.
Into the Q1, we've achieved slight growth and a slight decrease in operating results. But even though it would be hard to imagine, given this very clement weather that we experience today. Winter months were extremely cold, February March in Europe, North America. And when things are cold, you cannot easily build cement and concrete. So after a good start into the New Year in the United States and Europe, we had slight setbacks due to the bad weather conditions that had an effect on sales.
The road to the weather conditions only, our market environment, as we see it, is still excellent for 2018, particularly in Northern America and Europe. The demand situation is positive. Our order books are filled. We're supporting great construction projects, and we're expecting the results to be highly positive for the remaining 9 months of the year. We're positive that we will achieve our 2018 targets.
This is the outlook. We want to grow by 3% to 5 percent in 2018 in accordance with our strategy 2022. Operating result is to be increased by more than 5%. Investment below €2,000,000,000 And we expect to implement our Strategy 2022 very speedily in all countries. In conclusion, ladies and gentlemen, I'd like to thank, 1st and foremost, our staff and my management team for the very friendly and constructive welcome that I've had.
And I'd like to thank them for their great dedication and commitment in the past months, the past year. I know that the LafargeHolcim merger meant a lot more work for a lot of people well beyond the usual, but the results that we have are a just reward for all the work that we put in. I'd like to express my thanks and gratitude to all the team members that are here present and all that are following us through the video stream. Thank you very much and a successful AGM to all of us.
Well, thank you very much, Jan. Thank you and your colleagues on the Executive Committee as well as all employees of the LafargeHolcim Group. I would like to thank all of you once again on behalf of the Board of Directors for the performance and the results. Ladies and gentlemen, I would like to thank you for your attention for our presentations. You now have an opportunity to ask your questions.
We will be most pleased to answer them. We have had some persons signing up at the speakers' desks and I will now call those speakers to come forward to the rostrum to present their questions. At this point, let me also point out that it is only allowed to speak for shareholders. And please state your name and place of residence for the purpose of the minutes and show your access card. I would also like to ask you to be brief and to the point, should there be too many people taking the floor and making too long statements.
I will have to limit speaking time, and we will call those who wish to speak as the item they wish to speak on arises. I would like to point out that we are audio and videotaping the proceedings. May I now call Mr. Frank van Pernis from Erlenbach, who is the first person appearing on my list on my screen here. Can I ask you to come forward, please?
Mr. Chairman, ladies and gentlemen, members of the Board of Directors, ladies and gentlemen, shareholders of Lafarge Polsim. My name is Frank van Pernis. I live at Erlenbach, near Zurich, and I'm a member of Acterez. Shareholders for sustainable business management, established in Switzerland back in 2000.
First of all, I am pleased as a shareholder to see that the dividend policy of LafargeHolcim has been maintained for a number of years. But unfortunately, there are some observations I need to make that are less positive. Well, fresh blood on the management is good, but parts of the corporate memory and of experience is lost as a result. The new persons first need to settle in, while unsolved issues continue to exist, such as the issue of health and safety, as you have mentioned yourselves. Let me take the example of the accident on 17th September, 2007 in the Ambuja cement plant in Ratapara in India.
2 workers were killed as a result, and more of them were injured because the machine that they were waiting on was set in motion. As a shareholder, it's a great concern to me when I think that workers and maintenance persons are at risk or their health is at risk. Just for me to get a dividend in this business, I hope that the next of kin of the victims of the accident received generous compensation, generous remuneration. And in India, we have, of course, laws about health and safety in industrial operations as well as in Switzerland. In Switzerland, we have a federal commission on Health and Safety, providing consistent continuing education and monitoring the execution of inspections.
In India, the existing laws in the field of industrial safety and security are hardly applied. The Hindu, a daily paper, reported on the 19th January 2015 that this was the case. Although in India, as far as I know, there is no similar organization such as ECAS in Switzerland and state control and state inspection is not always as good as you wish them to be. This would be a welcome opportunity to Lafarge Holzim as a responsible employee to come in, close the gap and demonstrate to be a role model company. After all, employees are the most pressured assets when it comes to providing excellent service to customers.
And I would be very pleased as certainly all of you would be to be able to be proud of the safety and security policy of LafargeHolcim for the benefit of workers and employees. There are simple and not too expensive means to avoid accidents as the ones I've mentioned. Usually, it's sufficient to apply a simple lockout system on a machine to avoid such an accident. So Mr. Hess, on behalf of the Acteres Institution, I would like to present to you as a gift such a lock.
As a token showing that we at Actorez, as co owners of consider ourselves to be co owners of LafargeHolcim rather than speculating shareholders. Of course, you can use this lock as a reminder on your desk, but it would perhaps make more sense to make practical use of it in the plant in India on-site. I hope that Lafarge Holzim will make an effort to improve on safety at work in anywhere in the world and specifically in the developing regions in the world. Thank you very much for your kind attention. Thank you, Mr.
Van Pernis. I will be pleased to accept your gift. It's, of course, a nice gesture of yours. Now regarding the entire health and safety issue, let me point out and let me repeat what I said last year that the health of our employees and workers and our subcontractors related to our global activities is the top priority. These issues are discussed 1st and foremost at every meeting of the Board of Directors and in every type of reporting, be it at management level, be it on the Board of Directors, be it in major management meetings internally, we always, always first address the safety of our workers and health.
There is nothing worse for us than accidents and casualties, injuries or even deaths as a result of accidents. And I have often repeated that every case means that a father or a mother not coming home in the evening, not returning home in the evening and these are tragic events for us that we do take very seriously. And we always make sure that families or victims receive generous compensation or indemnification. Let me also refer to the fact that we've set up a new board committee especially devoted to health and safety and sustainability. And this in a board committee, a committee of the Board of Directors headed by Adrian Loader.
And this committee works very earnestly on the issues at hand. You can rest assured that we are doing everything in our power in this regard. Now this is my last comment. You mustn't forget that the whole number of accidents do not always refer to Lafarge Holsim employees, but 1st and foremost to subcontractors. This is no excuse.
Of course, we need to instruct subcontractors properly and sack people who don't play by the rules. But of course, we have thousands of lorries and other vehicles on the road every day. And among those, 1,000 and 1,000, of course, regrettably and But thank you very much for your statement and for your gift. Can I now call the next person on the list? On my list?
This is Mr. Kaufmann of the Ethos Foundation. Mr. Kaufmann, over to you. He is the CEO of the Ethos Foundation.
Chairman, ladies and gentlemen, members of the Board, shareholders that will be speaking French today, slowly, of course, so that everyone can follow Ethos and pension funds. The Swiss pension funds that we present, as you know, have been critical with regard to the merger of Holcim and Lafarge. And several of the concerns that we gave expression to back then have now come about. Not the promised values have not been created. €1,000,000,000 goodwill was recorded in 2017 and is now being revalued.
That's the most recent example of that. And that has come after a change in the position of the CEO and a change in the function of the auditors. And these values that were inherited from Lafarge, they may not have been known and they should not have been borne by the shareholders. Leave it at that with regard to legacy issues, but I'd also like to take note of the fact that efforts undertaken by group management and the Board, the executives and team members that are now allowing us to see the light at the end of the tunnel. We'd like to underscore the quality of the opening of the open approach that we have with regard to dialogue.
In 2017, I raised doubts with regard to the validity of the vote, with regard to the participation of GBL and M and S Gerasys Trust. It is highly disputable that these entities could grant discharge of liabilities given Article 96 of the Code of Obligations. It's an important topic because without participation in the vote of these 2 shareholders, discharge of liability would not have passed last year. Mr. Hess, you were very open.
You had an open approach in our dialogue, and you also had recourse to 3rd party experts. With respect to the expert opinion that was issued, they confirmed the procedure. But as the economist and not as a and as a non lawyer, substance over form is what I hold up. There is a conflict of interest, obvious, that GBL and M and S Chairs and Trusts, They should not be participating in the vote on discharge of liability. We ask them to voluntarily not participate in this vote and leave it to shareholders to grant discharge.
Historically, this was already the case for the Schweitzer Cement Industry AG. And dear Mr. Schmidt Heine, this AGM is also an opportunity for us to thank you for your great commitment that you've always had with regard to Holzim First and Lafarge Holzim. We did not always hold the same opinion as regards to the merger. But we recognize your long term vision, and we recognize your will to invest also in the areas that were nonfinancial.
Our world is reigned by short term perspectives. You, however, had a wide turn horizon. We hope that this will persist within LafargeHolzheim. And their shareholders, ladies and gentlemen, Ethos is confident with regard to the future of LafargeHolzheim, but the company is still facing various challenges with regard to environmental, social responsibilities, first of all. But the activity of LafargeHolzim has a considerable impact on the environment and also with regard to health and safety issues.
We're embracing the culture of transparency, its approach in matters of environmental friendliness and the objectives that have been raised. One of the arguments of the merger was that the new group could invest much more in research and development to develop technologies that would consume less energy and would be environmentally friendlier. We do take note, however, that research and development spending went down by 32% as regards 2016, only 0.32% of sales were invested in research and development. It's difficult to align that with environmental friendly standards. To spend only €99,000,000 on research and development and to, at the same time, carry out share buyback is not a responsibility attitude.
Research and development spending must be increased. Secondly, then, with regard to the composition of the Board of Directors, The Board must be regularly renewed. It must be well balanced with regard to gender and other issues and combine various interest and experienced backgrounds. We have no new members that are standing for election. Diversity, however, is an important issue.
It should be. We've taken note of the fact that Schweitzer Cement Industry has only one remaining member on the Board. GBL, however, still has 2. We don't understand that Mr. Savaris with only 3% of capital and 2,000,000 stock options still has a seat on the Board.
This is not a well balanced composition of the Board after Mr. Schmitt Heine's decision not to stand. We recommend that Mr. Savires not be carried for reelection. With regard to compensation policies, we're surprised to see that the compensation committee did not follow suit to the statement made last year where stock options were mentioned to be an exception.
And the comments he made here in the annual report were not cleared. The shares attributed to Mr. Holsen were forfeited, but the amount was not mentioned, the amount that he retained. The potential variable salary seems to be increasing, and therefore, we recommend not to approve of the compensation report 12. And we're against the suggestions made in 5.2, reject the proposal of the Board for the compensation of the Board and Group Executive Members.
Thank you.
Thank you, Mr. Kaufmann. Far as far as the statements you made today, we would again like to enter into a dialogue about, And we would like to demonstrate to you that we do not simply sweep your statements off the table but are taking them seriously. We will respond to 2 or 3 points as far as granting discharge at last year's AGM. I will briefly make a statement again when we get to the item of discharge.
And as far as Mr. Alstern's compensation is concerned, let me only say that there was no reason for us not to consider Mr. Olson as a so called good lever. So as a result of this, we had to and were able to fulfill the conditions laid down in his contract, no more or no less. I would like now ask Geraldine Picot, our Chief Financial Officer, to respond to the question of depreciation.
Thank you, Mr. Chairman. We carried out a comprehensive analysis of risks in our markets, and the assets have been revised in compliance with the international accounting standards, which led to a value adjustment of CHF 3.8 billion by CHF 3.8 billion. Well, okay. So let's call the next person on my list.
It's Mr. Ivan Maillard from Bern from Actharis. My name is Sylvain Mayer. I'm from Fribourg, and I will speak German, although I'm from the French speaking parts, Switzerland. Mr.
Chairman, ladies and gentlemen, I am also a member of the shareholders association called ACTAREZ, and I represent the protestant organization, Brood Farell today, who has fought for human rights and human dignity in the South for more than 50 years. I would like to ask a question to the Board of Directors regarding child labor in Uganda in Lafarge Holt Sims value chain. 18 months ago, I traveled to Uganda, and I talked to children and youth working for Lafarge Holtzim's subcontractors. Together with a local partner organization, we carried out 50 interviews in the region covered by this study. The result is that 150 children and youth extracted resources for Lafarge Holcim, for a subcontractor of Lafarge Holcim in the past 10 years.
Now to talk to these children and youth was quite shocking to me. I saw scars on arms and legs that referred to painful work. The children and youth in this age ought not to be exposed to such injuries. Last year, LafargeHolcim's subsidiary in Uganda stopped buying in raw materials from small operations and to work only with machine operated quarries. Hundreds of small businesses lost their earnings or lost their income from one day to the next as a result.
And in the following, in 2017, Lafarge Holzim launched a program for the region on a small budget. 2 toilets were built for a local school and there was a small amount of program for promotion of income a livelihood, but the former child workers do still not get any support. Although brought for Allais, our institution has come up with additional evidence and submitted it to the Farsh Holzheim's local management. So my question to you, Mr. Hess, is when will you provide support to your former child workers so that they can go to school again or do some vocational training.
Thank you very much for your attention. Thank you, Mr. Maillard. Well, the issue of child labor in Uganda was also a matter we discussed at last year's AGM. On our part, we carried out several comprehensive investigations, and the most comprehensive one in April 2016.
We never identified any reference to any child labor or to LafargeHolcim having obliged or encouraged children to work for us. We do not tolerate any child labor. If we were to be faced with any cases of child labor, we would be absolutely stringent and consistent And we will be pleased to look into the matter again. But let me repeat, we do not tolerate child labor in any parts of the world, Jan. Would you perhaps add anything to this?
No. You said it correctly. We investigated the matter when the first reference to suspicion was made. We worked with independent agencies and we haven't been able to identify what you described. And but I'll be pleased to accept your report, and we'll look into the matter again.
So let's move on to the next speaker on my list, Mr. Uwe Bachmann from Hohenlochscheid in Germany. He represents the Industry All Trade Union Association, if I am properly informed. I'm Uwe Bergman from Germany. I have been employed with this company for 4 decades and was a workers' representative for a number of years.
So this is the capacity I'm speaking in now. Last year, at the AGM, I referred to the situation regarding accidents at work. We now know that there were 65 casualties in 2017. These are persons directly or indirectly working for this company. I am a former workers' representative, and our experience has always shown if you want to significantly improve on that situation.
Of course, you said you would want to do that and we would like to support that. But then we need management on the one hand and workers' representatives of trade unions to work together. Top down procedure is good and well, but if you want to have a reasonable procedure, you also need to have a bottom up process, which we have always been willing to participate in. At last year's Annual General Meeting, we were pleased to hear that there was an allowance or an initiative to come up with a comprehensive agreement, a memorandum of understanding was signed in the summer of 2017. And in December, we found the declaration to be rejected on the grounds that it wouldn't be necessary and that it wouldn't fit with the change to the business strategy.
And one would provide internal rules and regulations to settle the problems. Mr. Hess, you talked about trust. The trust you need in this company. And I'll tell you one thing.
A document once signed and then to rejected, this seems to indicate to me that you destroy trust. And it's not something that I can go along with, that I can approve of. We've heard a few things about various situations in various regions in the world. And I would like to point out 2 things that are happening in Europe, where you might think that culture and development has led to certain things not happening here. On May 23, in Belgium, in the Abourg plant, components of a factory simply collapsed and a colleague named Olivier Deschamps was killed as a result.
And then the matre plant in the Pyrenees in France, a similar thing happened later on where a plant parts of plants collapsed. And we had a joint meeting and we were told that fortunately, nobody was in the vicinity. Fortunately meant that there was no casualty. There's no personal injury. I made a comment at the time.
I am pleased to repeat it here. I have always thought that we are working for an industrial company in the field of building materials and not involved in a lottery where you depend on luck. These are two examples that show that the company's business strategy produced such situations. And you shouldn't believe that this is the end of the list, but I'm only giving you 2 examples. What we would like to get at is for the Annual General Meeting and for you as shareholders to provide support to us in making sure that conditions will be improved upon in future, and we will come up with situations that satisfy the needs of our colleagues.
Mr. Jenisch, I encourage you to not only bet on trust that you will get everything settled internally, but work with a partner that will make sure that you can improve on the situation and that we will be able to cut down on the figures that have been reported in recent years so as to move into a situation that can be considered good. So I do hope that we I will be supported by the Annual General Meeting
today.
Thank you, Mr. Bartmann. Indeed, it is perfectly correct that back then, a declaration of intent was signed for a framework agreement. When it came to casting this into a somewhat more binding role, we verified this document, which was our task, and we came to the conclusion that in the context of our new strategy that underscores our empowerment of local markets, strengthening the connection with the local markets that we would prefer to work locally with trade unions. This was true in the past, and this is going to happen also in the future.
And after having looked at the matter in great detail, we came to the conclusion that we would cooperate locally in all the markets where we are present. And that above and beyond that, we would not create an umbrella framework agreement and sign it. This does, however, not mean that we would not also be prepared to constructively work with these organizations on a voluntary basis, which we will. Jan, anything more from your side? No, not substantially.
You're perfectly on the constructive cooperation that we have with union representatives in many countries. And currently, we see no need for an umbrella organization. No. We very consciously want to empower the countries to develop the country and to further health and safety issues locally. Thank you, Jan.
I have another speaker, Johan Baumann from Belgium. And I'd like to ask him to try and be brief. Mr. Baumann? Good morning.
I would like to specify, and not Mr. Johann Buman, I have been mandated by that person. He has not been able to come to this AGM today, Speaking on behalf of him, if I may, I'm Guy Guadchan Michel. I am a representative of Trade Union Organizations of Belgium, Berkey. Please go ahead.
Thank you very much, Chair. I'll try and be clear because previous speakers already addressed certain aspects that I want to draw your attention to as well. I'd like to say good morning to you, ladies and gentlemen, shareholders, dear Directors of the Board, I'm sure I'm part of the Health and Safety organization at the level of trade union organizations in Europe for various years. They've come to Zurich, to this AGM, to raise the issue of health and safety, accidents that lead to casualties very often. This is the 2nd time I speak and the first time I spoke.
I wanted to raise an issue of solidarity with colleagues from various continents that suffer casualties through accidents. I never thought that I personally could be affected by an accident. On May 23 in Ove, in 2016, I was working together with a colleague. He was working on the site. We were speaking together.
And a couple of minutes later, building collapsed and he lost his life. It took 3 days to dig him out. Life since then has not been the same for me, nor for members of companies. Every day, we all fear to lose other colleagues. And that fear is apologies.
Our company needs the shareholders. We need the shareholders, and you need us, the employees of the companies. We're workers. Productivity is important both for you and for us, but there's a limit to what's possible. Here at the AGM, we talk about financial matters, about the strategy and the future of the Group.
And I realize that there has been a certain development throughout the AGM. So over time, also social and security issues have been raised and are being costed, approached. And as a member of a group working with health and safety issues, I'm happy to see that you're taking up the for that. And I think it is inevitable that international framework agreements be signed on these matters. You may have carried out studies, and you may have come to the conclusion that health and safety issues need to be dealt with at the local level.
But I can tell you that the better the collaboration, the better the results. I took your message on board, and it is true that action has happened, changes have been witnessed locally on sites. I need to let you see what's happening on local sites, and I see that it's a good thing to empower regional organizations at country levels. But certain activities are then handed over to subcontractors, and this ends responsibilities of the company. Subcontractors are very hard to monitor, and accidents often happen under responsibilities of subcontractors and initiatives need to be undertaken that the entire chain of command or responsibility be controlled.
At one point of time, people lose control of what's actually happening. So local initiatives are good, but there's limits to that, too. It takes international strict framework agreements that would improve the situation for everyone. I'm closing by saying that a great man once said, I have a dream, my dream at the level of vapor is that and I'm not a Utopian here that my dream here is that there would never ever be any deadly accidents anymore. I'm sorry, I lost my thread, the emotion.
I think that as shareholders, but also as members of the group management, at every AGM, it'd be necessary to mention the examples of what happened and to pay respect and tribute to workers that lost their lives. So with that, I leave it at that. And I'm not asking you for a minute of silence, but indeed, let's bear my colleague Olivier in mind and the other colleagues that lost their lives in their work. Thank you. Thank you for your intervention.
We have said a lot about our responsibility in matters of health and safety. We talked at great length about corporate social responsibility as we see it. We will be upholding those principles. I very much respect your suggestion for a brief moment of silence for the staff who have lost their lives. This is not something we've done in the past.
But spontaneously, I am prepared to have a moment of silence in memory of our employees. Thank you. With this, I'd like to call on Mr. Omusis Ondomazuel from Uganda. Mr.
Ndomo.
Good morning, everyone. I would like to say that let the protocol remain observed. By name is Joel Ondoma from Uganda, Lafa Jolson. A lot has been said about Uganda when it talks of child labor. They talked of infrastructure development.
That involves the airport construction, where we shall be supplying a lot of cement. Basically, I have 3 issues to talk about. One is health and safety. In the course of 2 years, we have so far lost over 150 employees working directly or indirectly for LAPA JOLSIL. And so far, more are still dying.
This year, we have lost 2 employees in Abuja plant. 1 just happened recently on 20th May. An employee was murdered by a conveyor belt. So far, we have registered 2 fatal accidents in the same plant, and the question at hand is, how many more employees shall we be losing because we want to make money. In Uganda, where I come from, health and safety, though they say it's a priority, there is a gap to close with the company.
It's good that I have heard from you, Chairman, that you have formed a committee for health and safety. I will ask my I ask myself that this committee involve workers as well, Because if we form a committee without involving workers themselves, then that gap will remain open. We need to work together with the workers' unions. We need to work together how we involve these workers in their health and safety so that we minimize these industrial accidents. The second point on the second issue on my point is the job security.
After a merger, there was massive, massive redundancies in LafargeHolcim plants all over the world. Over 30,000 jobs were lost, and fewer are created so far. And when you look at the local management of Lafarge Holsim, Most of the redundancies that took place in 2015 during the period of a merger aimed at eliminating unionized workers. I have to give an example of Uganda, where 73 employees were declared redundant, and out of 73, 72%, meaning 53 of them, were members of UNION. Since that time, Lafarge has continued to expand in Uganda.
For now, as I speak, by Friday last week, they launched a new grinding plant in Eastern Uganda with over 100 employees, and none of them is a member of the union. Now the issue of social dialogue comes on board. You clearly said that you prefer to work with the local unions at the local levels. But I have to assure you, I need help from the shareholders that this won't be possible if we don't have social dialogue practice visible at the global level. My appeal to you, the Chairman, is to revisit the issue of having global framework agreement with the unions at the global level.
If this is not practical, then the local unions at the local level with management is not possible. The best example is Uganda, where you have a grinding plant with over 100 employees, but none of them is a member of the union. It doesn't mean that UNION is not there to recognize them, but they have bad policies at the local level that hinders UNION from accessing these workers at workplaces. So my ample request today in this AGM is revisit your stand and sign Global Framework Agreement. Thank
Thank you very much, Mr. Andoma. We spoke at great lengths about the topic of health and safety. And I would not want to revisit the issue. Also, the question of the Global Trade Union Organization was addressed by us.
We're taking your comments on board. We have heard them. And of course, also here, we will be looking into the matter as we go further. Would you like to mention something, Jan? In that case, I call upon the next speaker.
We have 2 or 3 more speakers. Next speaker, the name on the list is Antoon. Antoon. Good morning. My name is Antoon Antoon.
I'm Chairman of the Trade Union Organization, Holzim, in Lebanon. I represent BW Chairman, ladies and gentlemen, I'm proud to be a member of Holzem and now Lafarge Holzem because I've been working with Holzheim since 1979. I have however come here to speak to remind LafargeHolcim to hold their promise, keep their promise and to save workers' lives. I'm here because I need to remind you that LafargeHolcim is now keeping their promise. There was a global framework agreement that was discussed in 2017.
This agreement was agreed on together with the CEO of the former CEO of Holzent La Farge. And it was to be signed in 2018. Unfortunately, the CEO left his function. And today's CEO, Mr. Jenisch, refuses to sign this agreement.
This agreement would cover the following articles: health and safety of the work environment, human rights and labor issues, employment and work conditions organizational changes relationship with vendors and subcontractors And dear friends, we're here to tell you to please abide by your word and to sign the protocol because it's in the interest of everyone. It's in the interest of LafargeHolcim but also in the interest of the workers. Or in the context of LafargeHolzheim, 115 workers lost their lives in 2016, 'seventeen. LafargeHolcim therefore needs to undertake more efforts to work together with trade unions with a view to eliminating accidents to achieve the 0 accident goal in the work environment. After the LafargeHolc merger in 2015, more than 1300 jobs were cut.
Thank you very much, Mr. Antoine. And I believe we have already addressed the issues raised. And let me repeat one thing. What was signed back then by the former CEO was a declaration of intent.
And it was not Mr. Jenner's decision to finally not formalize the agreement, to not sign it. No, it was a question that we discussed at great length at board level and at group executive level. And I explained before why we came to the conclusion that we would not want to sign an umbrella agreement, which does not, however, mean that the topics foreseen to be discussed in this umbrella organization that those topics not be considered. I see that there are 3 more speakers on the list.
And I'm saying this because I noticed some people are longing for lunch. So you can prepare for that. It will take a while. Lena Yuliana from Indonesia is our next speaker.
Thank you, Mr. President, shareholders. My name is Lena Yulliana. I'm addressing here on behalf of Holcim Indonesia Workers as a member of LaFarge Wholesale Group as well as the workers of LaFarge Wholesale globally and collectively. This is a good opportunity to talk with you directly to inform all of the shareholders about the situation with respect to industrial relations.
I also want to raise your awareness about the feeling of workers in Indonesia. Since the merger between Lafarge and Holsim 3 years ago, all the workers around the world were suffering a lot. And Indonesia is no exception. It is partly even worse on our side of the world. We face redundancy of more than 500 workers before the merger effective in July 2015.
We fill residency in May 2015. This has happened in preparation of the merger. We are concerned not only about the residences of 100 of workers but also about the treatment of those who are still working for LafargeHolcim. Even during the phase of dismissals, the treatment of those the treatment of workers was bad. In our head office in Jakarta, management treated the dismissed workers like criminals with short notice and without any proper consultation and discussion with the union.
After this occurred, also the remaining workers feel insecure and uncomfortable about their future in the company. After the mass redundancy, the CEO even promised to us as workers that there would be no more dismissal. But in fact, in 2017, there are about 60 people 60 workers because of so called RBAC or Regional Business Air Service left the company. We report the RBAC Deficiency and disadvantage to Indonesian shareholders, and we demand that it is postponed at least 1 year because we assume that the benefit, it is by far not as big as predicted by the management. We, as workers, do understand that the merger of the biggest company in cement manufacturing is not an easy thing.
But we were always taught that this shift operation was for the sake of all stakeholders, including shareholders, customer and workers. But as a matter of fact, that steel company is shrinking in terms of the number of employee, this is a constant worry for us. It seems if workers had become only second, if not last priority in LafargeHolcim. These worries are fueled by the fact that more and more decisions are made top down and are imposed upon us without giving workers and their trade union any chance to discuss and measure our directives. This happened globally but also locally.
Management disrespect workers' trade union and their concern. Especially bad is the situation in health and safety, as I mentioned of the previous speaker before. This has now become an additional task without any chance to influence the decision. Health and safety were simply imposed as another special job for workers. We are forced to find like 1 a day or one unsafe issue or condition per day every day and announce or report it to the management, while at the same time, we need to do our job.
It's already getting harder because we are supposed to do more with less people. Under these circumstances, SETI become issue that scare workers instead of helping them in case an accident happen. You know what? The management blame the area managers or the area owner or the workers, give the warning letters without any proper investigation and any involvement of the trade union. Approach will not do.
We, the workers in most large wholesale operation, are in trade union are united in trade union. We were happy when the management announced last year that there will be a global framework agreement between the global union and Lafarge Wholesale Management as a new company. But we learned in early January this year that the management has changed the decision, their opinion unilaterally to renege on its commitment to sign a global framework agreement. This is what's a shock for us. This Global Framework Agreement is very important to ensure that freedom of association and collective bargaining as a basis rights as a state in ILO core convention are implemented both off the global and level.
This is also necessary in order to ensure that the constructive industrial relation is built on basis of the mutual respect. So we, as a worker, urge the management to come back to fair labor relation and social dialogue and sign the Global Framework Agreement with the Global Union and also respect the promise regarding the involvement of workers and their representative in informing of the occupational health and safety and preventing any more fatalities and major injuries at LafargeHolmes. Please tell our joint management to keep the word. Thank you.
Thank you for your statement on the issues that I've repeatedly answered. And health and safety and Global Trade Unions. Of course, we do take note of your statements, but we are not going to repeat what we said before. Let's move on to the second to last speaker on my list, Ms.
Shalini.
Greetings to Mr. Chairman, the members of the Board and fellow shareholders. My name is Shalini, and I bring you greetings from the workers of LafargeHolcim in India. We have already talked about the health and safety issues of workers from India. Several of my colleagues have already come here and spoken before.
And I know that once again, I'm going to get the answer that, sorry, this is all being talked about. I have no new answers to give. Irrespective, and I know that you're all waiting for your lunch as well, I'm still going to ask you to give me some attention so that we can remember people who have lost their lives to make the dividend that you are now getting. I bring you greetings from the workers of Darlaghat Factory One of my colleagues has already mentioned him. Indradev was loading One of my colleagues has already mentioned him.
Indra Dev was loading limestone onto a conveyor belt when he got trapped in the conveyor belt, he was dragged 3 kilometers on that conveyor belt before his lifeless body was found in the plant. What is even worse is that this is not an activity that a person should be doing alone like Intrude was doing. Up until now, it had always been done in teams of at least 2 to 3 workers just to ensure their safety. But there had been recent firings in the plant. And so Indrude was alone in the mines loading limestone onto the conveyor belt when he was killed.
Have there been a coworker? Maybe this tragedy could have been averted. Please remember that this Darlaq Hut plant, the same plant where over a year ago, another worker, Ajay Kumar, had fallen to his death while cleaning a chimney. This is not the first time that this tragedy has struck this plant. I bring you greetings from the Chandrapur plant of your company, where a worker, Arun Singh, was killed on 27th January of this year.
He was trapped between a wagon loading machine and the wagon itself. 2 days ago, the workers had complained to the management that this machine was not working properly because it was malfunctioning. Yet they were reassured that everything was okay. They needed to go back and work. It was during this time that there was an electrical malfunction, there was a big vibration, and this work got trapped and died a very painful death.
What is even more surprising is that after this accident, too, the workers were yet again meant to go back into the factory and work. And 2 days later, there was yet another malfunction in the same machine, and another tragedy was very narrowly averted. I bring you greetings from the workers of Bharatavara plant that the very first speaker from Ectaris also spoke about, where 2 of their colleagues, Dhrhendra Verma and Vineet Kumar Verma, were killed just about 7 months ago on 17th December 2017. They have been carrying on scheduled repair inside the crushing mill of the plant. And yet, somehow, the other suddenly, the mill started working, and they were crushed to death in a crushing mill.
The worker from Ectares very nicely gave a lock to say that these lockout mechanisms exist. What I want to point out is that there were lockout mechanisms at this plant. There were 3 layers of lockout, yet they were all bypassed because it was thought that an infection team was coming and they needed to get it working very quickly again. And so the lives of these 2 young men were lost. This Bharatapara plant is the same plant where 5 years ago, 5 other workers were killed when a dilapidated and overloaded fly ash hopper crashed through 5 storeys, bearing these 5 workers underneath, insuring, scalding hot fly ash.
These trends are not mere accidents or tragic incidents as we are being told. They are criminal acts by a management that values profits over the lives of its workers, a company that believes in firing workers to the extent that the safety of the workers is compromised, a company where machines that have outlived the utility are still being used to save a few dollars even if means people dying. These accidents we need to take very seriously. Why I want to ask you, are the lives of Indian workers so cheap, so expendable that they can really be subjected to these kind of irresponsible accidents? The reason that was already alluded to before is what is called subcontracting or contract workers.
Over 80% of the workforce in LafargeHolcim Plants in India are the subcontracted workers. These are workers that hold that LafargeHolcim doesn't see as their responsibility, irrespective of the fact that day after day, year after year, the same worker is coming, entering the plant and working on-site for the same job which the plant cannot do without. So these are necessary workers. But somehow, because we call them subcontracted workers, Holson has shrugged off their responsibility. Lafarge Holcim has shrugged off their responsibility towards these workers.
This is a convenient excuse to deny the worker deduced. Most of these workers have very little to go with because of this layer of subcontracting. They're invisibilized to the company even though they are responsible for 80% of the production. These are workers who've been working for 10, 15, 20 years at the same company. Yet these workers get less than the legally mandated minimum wages.
They don't get pension or medical benefits. And they're always under the threat of being fired if they ask for their rights. It is for the protection of these workers, so the lives of Indian workers that we are asking for the Global Framework Agreement. It is time that these workers instruments were put into place so that we can actually have a dialogue. It is not that we like to come to Switzerland in order to ask the local management to have a dialogue with us, but the fact is that the local management over there doesn't want to talk to these workers.
And therefore, we have to come over here and address you and apprise you of the situation that is happening over there. So again, I would request dear shareholders and members of the Board and Mr. Chairperson that please honor the promises that have been made. Please enter into these Global Framework Agreements. I know you have said that you've talked to unions and you feel it's not necessary.
But from the workers in India, we are still requesting you to revisit your decision and enter into the Global Framework Agreement, end the process of subcontracting workers and respect the lives of workers. Thank you.
Thank you, Madam.
Thank you very much. As you said yourself, we have discussed this matter before and we have made our statements on the matter. I will be pleased to take note of your statements, but I won't repeat what we said before. Next on the list is Mrs. Petra Kalman.
Petra Kalman, please come forward.
My name is Petra Kalman.
I'm Petra Kalman from Budapest, Hungary, and I represent the owners of the Hungarian Hyotchuba Cement Factory. Mr. Chairman, dear shareholders, since 1994, has LafargeHol team been successfully preventing our independent cement factory to take up operation in Hungary. Lafarge Holcim realized on the basis of the difference between Cement Marketing and Production costs that between 1994 and 2010, a result of 400 and €30,400,000 in our plant only based on the documents that are at our disposal. Compared to the results in Western Europe in the Cement Industry, €105, million can be considered as extra profit.
This means that LafargeHolcim realized so much more profit by having the factory in Hungary rather than Western Europe after our factory was closed down. From 2011 to this day today, you have acquired another €170,000,000 of extra profit by taking your surrounding plants and producing the same volumes as our plants, but on the basis of variable production costs only. So Lafarge Holcim committed theft on our shares, €325,400,000 in of results in Western Europe, €275,000,000 of extra profit. Thanks to the infrastructure concept of the Hungarian government, cement the cement industry in Hungary is growing as never before. So we don't need any explanation why it is in the interest of LafargeHolcim to retain its monopoly and to make it impossible for the Hyuchuba plant to be to go into operation or to avoid it from going into operation.
We have been expropriated of our shares. And of course, there are proceedings underway against it. And sooner or later, there will be a ruling on compensation. We will shortly hear from Mr. Hess saying that Lafarge Holzheim has done everything to find a reasonable settlement.
But due to the unreal expectations of my fathers, it would have been impossible. But the reality is different. In 2010, Lafarge Holzim and representatives of the Hungarian owners and have a meeting for the first and last time to find a settlement and there was an outcome. We had Professor Noble from Holtzim and my father who made an agreement and instructed their lawyers to draw up an agreement. Prior to the signing of it, Lafarge Holzheim broke Kit's promise referring to the lawyers in Vienna and Budapest being against the settlement as they would be able to come up with a better result in Hungary.
I would like to ask you to tell me with whom and what about you have found an agreement with regard to our plan? Thank you very much indeed.
Thank you, Frau Kalman.
Thank you, Mrs. Karmann. You are referring to a far too long legal matter, litigation at the times of Holzheim. I personally was looking for a solution together with your father. And we had repeated discussions trying to find a solution.
Last year, I told you that given that the allegations, most of which we consider to be untrue and repeating them every year will not bring you any closer to the truth. We continue to be willing on a reasonable basis to enter into a conversation with you to bring this unfortunate matter to a close. But let me repeat what I said last year. As long as you keep raising demands for 100 of 1,000,000 that are unjustified, we cannot accept for the benefit of our shareholders to accept those highly unreasonable demands. I said earlier on that in this particular case, mistakes were made on both sides.
We conceded that, but that also applies to your side, to your party. And I would like to ask you to take home as a message that we are willing to enter into a discussion if we can find a reasonable basis, reasonable grounds for those assembled here today. We need to take good care of the money entrusted to us by shareholders. It would be the simplest matter for us to solve this issue by simply transferring a few 100,000,000 to Hungary. But we won't do that because we have our obligations to those who entrust their money to us.
Thank you very much for your intervention for your statements. We have somebody else on the list, Mr. Walter Grop. Can I ask Mr? Grop to be brief?
I can see that you want to say something to us about the issue of health and safety. Please bear in mind that we've heard quite a few things on the same matter. But please go ahead. Of course, it's correct. Quite a few things have been said.
I'm Walter Grob from Bern. I would like to speak on the annual report. The entire annual report includes a chapter on risk management and health and safety, yes. But as far as all these accidents and casualties are concerned, I can't find any piece of statistics. That's the least thing we, the shareholders, can expect from you that you tell us how many casualties and injuries we had on our conscience.
And this is shocking to me on your behalf. I don't want to be the co shareholder of a company who puts their employees at such a risk, as the lady from India just outlined. Even if one or the other case may not be very clear cut, It would be up to you to provide precise statistics to us on those accidents. So take that accident with the chimney. Now this wouldn't have happened here in Switzerland or take the other case with the conveyor belt accident.
So you had the same emergency stop systems as in Switzerland, this wouldn't have happened. The appeal by the Lady of India is perfect marketing for this initiative about corporate responsibility in Switzerland. And you're demanding, you're asking for it. You should take voluntary action rather than wait for the state to intervene. Thank you, Mr.
Grog. You referred to our annual report. Maybe you failed to see that it includes 2 parts. I would almost suspect that you only read part number 1. There is a second part, which is called sustainability report 2017, where we do provide detailed information on accidents and the health and safety issue.
For those of you who may not have seen it, we've got a thick volume of the annual report and a smaller booklet, which is the sustainability report that highlights those matters in detail. Anyone else who wishes to take the floor at this point? This is not the case. So let's proceed and begin to deal with the items on the agenda. First of all, let me welcome the independent proxy, Doctor.
Thomas Rees, who received instructions from many shareholders again this year to represent them. Mr. Rees, can I ask you to briefly rise so that people can see you? Yes, he is. And I would also like to welcome Mr.
David Quinlan and Mr. Frederic Gourd of Deloitte as representatives of our auditors. Furthermore, let me welcome the notary public, Mr. Markus Muller of the Zurich Notary Office and everyone else involved pursuant to Article 13, paragraph 1 of our articles of incorporation, I shall chair the meeting. I here with appoint Mrs.
Dragana Semyonovich to keep the minutes based on Article 13, paragraph 2 of our articles, and I would like to make the formal statements as follows. The Annual General Meeting today has been duly convened in compliance with the law and our articles within the notice period of 20 days. Publication of the invitation was made on April 13, 2018 in the Swiss Commercial Gazette and has also been available for downloading from our website. Registered shareholders have been personally invited by letter dated April 13, 2018. In the run up to the Annual General Meeting, the Board of Directors has not received any requests to put additional items on the agenda or any motions.
I hear with note that the annual report, including the management report, the annual consolidated financial statement of the group and the annual financial statements of Lafarge Holzheim Limited and the compensation report as well as the auditors' reports have been available at the company's headquarters of Draupazvyl Jorna been available for inspection within a notice period of 20 days before the Annual General Meeting. The agenda includes all the standard items to be deliberated on. Again, this year, we are going to use a televoting system. We're going to cast our votes electronically, and I should quickly instruct you on how to use the devices. At the beginning of every vote, the item to be voted on will be displayed automatically and you will be called to cast your vote by pressing the button of your choice.
The button on the left stands for yes. The button at center is for abstaining. And the one on the right hand side is for no, for rejection. Once you've cast your vote, please check your confirm your vote by pressing the check mark, the white check mark on the right. And then wait for confirmation that your vote has been recorded.
This may take a few seconds each time. As you can see on the screen behind me, In the meantime, attendance figures have been established. I would like to ask to display them, being done already. As you can see from the screen, of the total share CapEx of 1,213,000,000 €18160,000,000 divided into 606, €909,80,000 shares at a par value of CHF 2 each. We have represented by shareholders 72,448,452 by the independent proxy, 3 17 14,396 absolute majority of the votes represented is 194,000,000 731,425,000,000.
And the absolute majority of par values amounts to CHF 389,000,000
CHF 462,850.
And we have a total of 743 shareholders here in all. So in total, we've got 389,000,000,460 2,848 boats and par values in the amount of CHF 778,925,696 represented today, which accounts for 64.17% of the shares in circulation. Thank you very much for these figures. Now moving on to the tellers. The tellers will be used only if there is a problem with the electronic voting system.
The tellers will also be available to you should you have any questions or issues with electronic voting. The tellers actually would not have to be elected by the Annual General Meeting, but they are appointed by a decision by the Chairman. However, we're going to make use of the opportunity to check on our systems by carrying out a trial run. I have appointed the ladies and gentlemen shown on the screen now as tellers, and we're going to carry out a trial election. Please use your voting devices.
Now those who wish to elect the proposed tellers, please press the Yes button as soon as the displays are ready, those against press the no button and those wishing to abstain from voting, press the abstention button. Don't forget to confirm your vote by pressing the white confirmation button and check on your display whether your vote has actually been recorded. Now these squares on the screen are showing you that the countdown is on. Countdown is on. Please cast your vote.
Time is up. And the vote is now closed. Please bear with me until the result has been established. This is a nice cement lorry passing by, as you can see on the screen. And I hear with note that the trial election has worked properly and would like to ask the TELUS to briefly rise so that shareholders know who to turn to if there are any problems related to the casting of votes.
Telus, please rise. And thank you very much. So you can see that even when it comes to election of tellers being some saying no and some abstaining from voting. I would assume that those saying no simply wanted to test whether the system actually recorded their vote. Now in conclusion of preparation, let me refer to the fact that we are taking decisions or resolutions today at absolute majority.
That is more than half of the votes represented. Item number 1, approval of the management report, the annual consolidated financial statements of the group, the annual financial statements of Lafarge Holcim Limited and the compensation report and auditors' reports. You have received the annual report upon request and it's been available from our website since March 2, 2018. It was available. It's been available at our headquarters from March 3.
Mr. Jan Jensch provided additional comments on the business in the year under review and about the outlook. Deloitte, the auditors have audited the annual and consolidated financial statements. You will find the auditors' reports on Pages 224 and 2 46, respectively, of the annual report. The representatives of Deloitte have declared prior to the Annual General Meeting that they do not wish to make any additional comments on their reports.
The Board of Directors proposes to approve the management report and the annual and consolidated financial statements of LafargeHolcim of 2017. We're going to vote in a minute, but let me ask again whether anyone is requesting the floor on the annual report. This is not the case, So let's proceed to the vote. Those who wish to go along with the Board's proposal, please press the Yes button. Those, again, choose the no button.
And if you wish to abstain, press the abstention button and go on to confirm by pressing the white confirmation button and check whether your vote has actually been recorded. The countdown is on now. Thank you very much. Waiting for the results to be established. I hear with note that you have approved the management report at a vast majority.
You can see the figures, the precise figures shown on the screen. Moving on to item 1.2, advisory vote on the compensation report. You will find the compensation report in the annual report on Pages 84 to 106. Information on compensation can also be found in the financial section of the annual report. Deloitte, the auditors have audited the compensation report and you will find the report the auditors on Page 107.
Allow me to make some preliminary remarks. Even if the Lafarge Holt team management has produced good results and come up with a great deal of work. We need to be reasonable when it comes to management salaries. And of course, we need to apply the principle of transparency. The salaries of our top managers have stayed within a reasonable margin in 2017, as we believe, and this will remain so in future.
Important voting advisers have recommended approval of our motions. I would like to remind you that the vote on the compensation report again will be an advisory one, a binding vote based on the Swiss Ordinance on excessive or against excessive compensation in listed companies will be conducted later on under item 5. Anyone requesting the floor on this Item 1.2? This is not the case, So we're going to proceed to the vote. Those who wish to approve the board's motion, press the Yes button.
Those against, choose the no button. And if you wish to abstain from voting, press the abstention button and then go on to confirm your vote by pressing the white confirmation button and quickly check on the display as to whether your vote has actually been recorded. Let's cast our votes now. Cantal is on. I declare that you have approved the compensation report of LafargeHolcim at 69.38% of the vote.
There were many no votes and few abstentions. The Board of Directors takes note that our compensation report for the 2017 financial year actually does not get the approval, the extent of approval that we would usually expect. And we take note and take seriously this statement. And under the heading of the Nomination and Compensation Committee, the Board of Directors will again review the compensation guidelines and perhaps adjust them and report them in our 2018 compensation report.
We move on to item 2 of the agenda, discharge from liability for the members of the Board. I already said that at this point of the time, I'd like to get back to a question that was raised by Vincent Kaufmann, the Managing Director of the EFOS Foundations, an issue that was raised at the last AGM. Mr. Kaufmann, last year, wanted to know why when voting on discharge of members of the Board, shares were admitted for the vote that were held by directly or indirectly by Board members Demare and Saviris. We had a follow-up meeting with representatives of Ethos.
Together, we then decided to demand an expert opinion issued by independent experts on the issue. We agreed on such an expert, and that expert came to the conclusion that there were no legal reasons for excluding those shares from the vote on granting discharge from liability. I'd like to mention at this point of time that I'm very thankful to remedy a situation that may not have been perfectly clear. So Ethos did represent the interests of their stakeholders in a responsible manner, and we're grateful for that. We can now move to the vote on granting discharge from liability for the members of the Board and the Executive Board.
Board proposes to grant discharge from liability to Board members for their activities in Business 2017. Does anyone wish to speak on this? This is not the case. Again, I draw your attention to the fact that anyone entrusted with the conduct of business in 2017 is excluded from the vote here. The numbers of shares represented has already been reduced in the system.
For voting, those of you who approve of the Board's motion to grant discharge to members of the Board of Directors, the person entrusted with management, please press the yes button. If you don't approve of the motion, press the no button. Abstain by pressing the button for abstentions. Please confirm your vote by pressing the yes button. Check on your display whether your vote's been recorded.
Time's running. I had the impression there were fewer squares. But there you are. I can tell you that you've granted discharge from liability to the Board members and management with a YES voucher of 76.6%. You see exact figures on the screen.
As I see it, this is not a satisfactory result for us. We take note of that, and we will do everything in our power to make sure that next year, we'll have a better result. We move on to agenda item 3, appropriation of retained earnings. The board proposes also this year to pay out a dividend from capital reserves. Two steps are required for that to be possible.
The first step, the board proposes to carry forward the profit of €11,650,000,000 to the new year. Anyone wishes to speak on this? This is not the case. In that case, we proceed with a vote. For legal reasons, 2 steps are necessary.
We will first vote on carrying forward the profit, an amount of 11,650,000,000. Euros If you approve of the Board's motion, please press the yes button. Don't approve, press the button for no or press the button for abstentions. Again, check the screen after having confirmed your vote by pressing the yes, confirmation button, the white one. Time is running.
The results should be coming in shortly. And here they are. Thank you very much for the very high yes vote share. You followed the board's motion. Thank you very much.
You can again see the exact figures on the screen. Let's take the second step, too, to determine the payout from capital contribution reserves to shareholders. The board proposes, as mentioned before, to pay out a dividend of CHF2 per registered share. Total amount of the payout is maximally 1,000,000,241,000,000, resulting from the total share of votes outstanding. Treasury shares and shares held by subsidiaries are not receiving a dividend payout ratio is reduced accordingly.
Anyone wishing to speak on this? This is not the case. We proceed with a vote. Same procedure. Press the yes button if you follow the Board's motion, the no button or the extension button if you don't.
Confirm by pressing the white button and check. Time is running now. I again take note of the fact that an over overwhelming majority of people voted with yes. Yes, vote share is 99.77%. Thank you very much.
You see the other figures on the screen. The payout of the dividend will happen on May 16 this year. And with this, we move on to the next item of the agenda. First, however, I'd like to address the esteemed members of our Board that are not standing for reelection, ladies and gentlemen. Already early April, we informed that 2 highly esteemed and most competent experts who have been closely connected to La Farge and Holzimp for decades, will be leaving us.
Of course, I'm meaning Thomas Mittie and Bertrand Colon. I'd like to address Bertrand Colon first. Ladies and gentlemen, today, we're saying goodbye to Mr. Bertrand Colon. Bertrand Colon, after more than 40 years, will be leaving the group where he held a seat on the board, dear Bertrand.
It was a pleasure, more than a pleasure and honor to be working side by side with you over the past years. This is an excellent opportunity for me to thank you. And I'd briefly like to look on your career. In Lafarge, you were the CEO and determined on the Board over more than 14 years. This time, you considerably broadened the Lafarge portfolio in terms of products and solutions.
And you gave the Lafarge an international standing as a leader. Under your leadership, La Farge expanded from 20 to 75 countries, thus becoming an important player in the industry. But your commitment, Bertrand, went far beyond that function that you had at the helm of the company. You also worked hard for sustainable development issues, always bearing in mind company must adapt to the environment it is active in. You were one of the very few company heads who were present at the Earth Summit in Rio in 1992.
And you also took up your commitment in the World Business Council for Sustainable Development, whose chair you were in 2004. You were quick to pick up on the importance of environmental issues and sustainable development issues in the life of a company such as ours, ladies and gentlemen. You will have understood that Bertrand Collomb left his imprint on the Lafarge Group, but beyond that also on French leadership. You were also elected to the Academie des Sciences Morale Politique in 2021. You were for Lafarge what Thomas Schmidtani was for Holcim, an intrinsic part of that company.
And without either of you too, the merger between Lafarge and Holcen would never have been possible. Thank you, Bertrand. Thank you for your engagement for our group. You have shaped Lafarge and also that your mark on Lafarge holds him. And the success of our group today is partly due to you, too.
We have a long list of activities that you have carried out in the course of your engagement for our group, and I have to leave it at that. On behalf of all employees of the group, on behalf of the Board, on behalf of everyone who's had the privilege to work with you, thank you. We wish you all the very best. We know that you'll have a lot more time now, time that you can dedicate to one of your passions, among them to your horses. Ladies and gentlemen, let's give thanks to Mr.
Bertrand Colon. Dear Bertrand, let's ask you to step up and join us here in the podium. This is a sign of our gratitude for all your work and your contributions. A very small present for you, Bertrand. Thank you.
Thank you for your very kind words. I'd now like to address Thomas Schmidt Heine. Since 1970, Thomas Schmidt Heine has held various managing positions in the former Holter Bank and later Holzim. Among them also, he has held a seat on the board. And since the merger of Lafarge and Holzim in 2015, he's been a member of the Board of La Farge Holzheim.
After almost 50, 50 years, Thomas Smitani has now decided not to stand for reelection. We know that such a watershed for the Board. We all know about the huge merit Thomas Mehta and his family have had for this company. And it is almost impossible to underestimate the important role that the family and Thomas Smetzeny have had for LafargeHolcim and to find words for the many merits he has had. Well, I can say it in a nutshell.
Holzim and LaFargeHolzim simply would not exist without the Schmidt Heine family that have successfully built the company over 4 generations and have further developed it. Thomas Mehtani started out at Holcim in 1970. 6 years later, he was called to the group executive board. He has held the chairmanship there from 1978 to 1,000 and 1. It was then that the company expanded to many promising growth markets in Eastern Europe, in China, in India, in Southeast Asia.
And it was under his leadership that it became market leader. In 1978, Thomas Mehtany was elected onto the Board of Directors that he chaired from 1984 to 2003. In 2001, the bank was rebranded to Holcim. In 2003, the single share was created where he renounced on a controlling majority. At the same time, he also stepped down as Chairman of the Board.
In 2015, Thomas Schmitt Heine significantly contributed to the merger of Holzim and the French Lafarge. He, from the very beginning, was convinced of the industrial logic of such a merger. And Lafarge Holzheim, as you all know, is now the worldwide leader in building materials industry. Ladies and gentlemen, esteemed shareholders, With Thomas Schmitt Heine leaving the board today, an epoch of 100 years is coming to an end. This is an era where the family have left its mark since the establishment of the company in 1912.
We're very happy though that the company will remain an anchor shareholder of the company. On behalf of the Board, on behalf of all the employees, I thank Thomas Schmidt Heine for his extraordinary services provided to the company. Thank you, Thomas. Thomas, I'd also like to thank you very personally and very cordially. Working together with you has always been extremely pleasant and highly professional.
Your know how is irreplaceable. No one in the industry knows it better than you do. And in my career that has also spanned quite a few years, I've never met anyone that has so successfully paired professional know how with practical know how and a vision for the future. This is something you have proven time and time again, also in the merger of Lafarge and Holzin, a merger that was to create a market leader for the next 100 years. I thank you as a colleague on the Board.
I thank you as a friend for your support and your commitment for LafargeHolzem. You will be missed in the board, but we're very happy that you will accept the function of an honorary president that you've been granted by the Board. Thank you again. Thank you again, Thomas. Is there anyone wishing to speak at this point of time?
I'd like to ask Mr. Jean Claude Wenger to move to the speaker's desk. Ladies and gentlemen, dear shareholders, Mr. Schmehagen is not standing for reelection means that the chair and the responsibility that the family Schmitt Heine have occupied over generations will be vacant. It is only appropriate to briefly refer to the persons and connections that need to be mentioned here.
And I'm doing so because myself, I've been a member of the Board of the Holzent company over 3 decades. Thus, I've gotten to know Ernst, Max and Thomas, the 3 family chairmans of the board. It all started with a grandfather, Ernst Schmittaini, Kuster, the elder, who established the company Holterbank in 1912 as a cofounder, a company that he also managed afterwards. In 1935, after an airplane accident in the desert of Sinai, he left us, and after his death, Ernst Mittani, the younger, the son, took up his function at the age of 32 years. After his retirement in 1974, he was followed by his brother, Max, and from was Chairman between 1984 1988.
And also Max Schmittaini called upon his son to follow him, who then followed him in his shoes as Chairman of the Board. The great economic expansion that the Holter Bank oversaw after World War II, together with the geographic expansion, the activities led to a situation where the family name Schmidt Heine was highly renowned well above the Swiss borders, a name that was known in all corners of the world. And all members of the Schmidt Heinrich family have done everything in their power to work in the spirit of free entrepreneurship. This entrepreneurial spirit is important. It creates leeway.
Without that, there is no initiative. All family members saw themselves as entrepreneurs, and they were well aware of their social responsibility. Already. The 2 brothers, Ernst and Max, made sure that Schmitt Heine, the name, was a seal of was a mark hallmark for Swiss responsibility into the entrepreneurial world. Thomas followed his father as Chairman of the Board, and he was well prepared for the function.
He also had a very clear vision. He wanted to make sure that the estate inherited would be well taken care of, And he wanted to make sure that the company would expand and be more broadly diversified in terms of geographies also. What he first had to do, however, was to consolidate the group. He was very persistent and systematic in his approach. Under him, the Hildebrand Group developed in a highly gratifying manner and also in critical situations that happened in the early years of his chairmanship.
Thomas Mehtani steered his ship with calmness and wisdom. Under his leadership, the company saw great momentum between 1984,2003. Holder Bank expanded into a further 23 countries. In 2012, Holcim looked back on 100 years of its existence. A few years later, the negotiations with Lafarge ended in the merger of these 2 large cement companies.
This was a significant step that was supported by Thomas Schmitt Heine. And it is immediately obvious that large company with an international franchise like LaFarge Olson poses highest requirements for the management. A lot of things have been achieved. Others are waiting to be achieved. Persons entrusted with the management of the company deserve our trust and support.
Apart from the necessary understanding and respect that all involved in decisions must have for one another and that we must have for them. We should still see some of the entrepreneurial spirit of the Schmidt Heine family. Persons that bore and bear that name deserve not only our respect for their entrepreneurial activities, they also deserve our great thanks from Astar share the shareholders. Thank you. Thank you, Mr.
Wenger, the shareholders. Mr. Thomas Schmitt Heine would like to take leave from you. Thomas, if I could ask you up on stage, please. Ladies and gentlemen, dear shareholders, it is exactly 40 years ago that I, as mentioned, had the privilege, at the age of 33 only, to chair the Board of the Holter Bank AG in 1984.
I also took on the function of President, of Chairman of the Board. At his last AGM, my father left us with his thoughts. And I'd like to remind us of them because it's part of my bag of tea set. Success can be a blinding factor. Acquisitions that are simply based on power will not benefit the bottom line.
Make sure that you never become dependent on banks. Cumulated cash flow should be higher than capital investiture, research and development are important for long term success. Avoid creating an administration that is too large. Training is the most important factor for success. And he also said, work together in respect of one another at all levels.
This is what creates an excellent working climate. This was the baggage that I received from my father. And together with my team at Holder Bank, I tried to build on that in 1984, the year when I took on the chairmanship of the Board, the 2 countries made up 90% of the consolidated profit of the company with Lebanon and South Africa. It was a very daring model. There were very clear dependencies on very few markets.
And therefore, over the years, we've been building up positions that we then integrated into the group. Additionally, in my time, we've also bought out many minorities to make sure that we had access to cash flow. From the very loose holder bank network, we created the Holcim Group, which now is Lafarge Holcim. To steer this group successfully, to attract talent, some very fundamental principles of leaderships have proven their worth in my time. First of all, the principle that decisions must be taken by those bearing responsibilities.
Secondly, an intensive dialogue over many hierarchical levels means listening to one another. And I did so as I visited many of the training sessions. This led to a training to a corporate culture that became a pillar of the company that should again become a pillar of this company. Enter into calculated risk because a culture of 0 mistakes is an impediment to development. If I made mistakes or when I made mistakes, I faced up to the consequences because one needs to draw lessons from difficult situations.
Once taken, decisions must be implemented fast. And with all consequences, even though a decision may then have to be adapted later on. Respect for man and environment, positive attitude visavisaclimatissue can mobilize all strengths. Modesty is a Swiss trade. This should be part of the corporate culture too.
This helps us being grounded, well grounded. And as leaders, we're models here. As largest shareholder, I always wondered how the industry should and could be positioned in the long time and the long horizon, 2,007, 2008. We've had various visits from Private Equity representatives that wanted to take over Holcim. I could have easily sold my shares for CHF 8,000,000,000 back then.
I didn't. Instead, I sat together with my team to devise a strategy for the future position of the company. We came to the conclusion that this industry called for another round of consolidation, and this is how in 2015, LafargeHolzheim was created after a round of tough negotiations. LafargeHolzheim is a clear market leader. And after the changes in the group executive management and the Board, we have now set we have now created the foundation on which to build.
Where do I see the greatest challenges that await LafargeHolcim and the shareholders of the group? Well, the environment, 1st and foremost, as a CO2 issuer, a large one, we need to be highly innovative. Through that, a challenge can become an opportunity. Secondly, transparency. The phenomenon of data utilization, which is another challenge, by the way, will have an effect on management procedures and processes.
Machines, however, will not replace people. They will perhaps replace certain jobs. People who are prepared to accept responsibility and are open for new developments will remain important to as we shore up our future. 3rd, then the training of the next generation of leaders. We need people who see challenges as opportunities rather than threats.
The many options that we have in environmental issues should be seen as opportunities an opportunity to solve the problem of our society today. Plastics, for example, exist everywhere in the world and in the seas, And we could be using some of that plastic as fuel, couldn't we? 4th, culture of learning. I'm deeply convinced that people are in this world to learn. If curiosity and learning are not attitudes that we hold dear, We will be fossilized or casting concrete.
This will be the death of all renewal for our society as a whole. This would spell doom, your shareholders. I'd like to thank you for the 40 years of trust that I've been able to enjoy, trust that I have been that I've tried to live up to. As a shareholder, I give trust to a new generation now, and I hope to accompany LafargeHolcim for many years to come. I'd also like to thank my colleagues on the board, a board that has worked very intensively over the past years.
And finally, then I'm thankful for the numerous meetings, encounters with employees and affiliates from all over the world. I've always had an open ear. I've always been happy to learn. I've always been happy to collect ideas. Thank you very much, and all the very best.
And
for you, we also have a small token of our great appreciation and gratitude. Anyone else requesting the floor at this point? This does not seem to be the case. So let's proceed with item 4. Before we're going to proceed to elections, let me briefly refer to some changes that the Board of Directors has resolved on regarding its committees.
The strategy committee was abolished. Discussions on strategy are a core mandate of the Board of Directors and will in future be held within the scope of the meetings of the entire Board of Directors. In addition, we have decided to change the chairmanship of the Finance and Audit Committees as well as the Nomination, Compensation and Governance Committee. Patrick Cron, of course, provided he's going to be reelected, will take on the chairmanship of the Finance and Audit Committee, while Oscar Frank Ruhl also provides he's going to be reelected, is going to chair the Nomination Compensation and Governance Committee. This is to meet the needs of a governance standard according to which major shareholders ought to refrain from executing control of the work of committees.
I would like to thank Dieter Spalte for his untiring efforts on the Strategy Committee. With his wits and his ability of structural analysis, he has provided very valuable strategic scenarios, making sure that they were then put into practice. Thank you very much, Dieter. Gerard Lamache, I would also like to thank for his responsible management and chairing of the Finance and Audit Committee. The chairing of this committee means a great deal of additional effort.
And as the chairing of other committees, it requires a high degree of technical skills and knowledge. It is attributable specifically to Gerard Lemarge that in the case of the Syria issue, an independent investigation was launched immediately with a clear mandate of clearing up the facts without any regard to persons involved and then to publish the results. In his capacity as the Chairman of the Finance and Audit Committee, Gerard took care of the launching of this investigation and monitoring it. Thank you very much, Gerard, for your valuable work. And finally, I would like to thank Nasiv Saviris for chairing the Nomination Compensation and Governance Committee, which is highly demanding to ask to the Chairman of the Compensation Committee, is not always the favorite person on the Board and in the executive management because after all, it is this person who contributes crucially to the amount of compensation paid.
So thank you very much, Nasiv, for your valuable work as well. Now moving on to elections. Elections of the members of the Board of Directors, the Chairman of the Board as well. The election of the members of the Nomination the nomination compensation and governance committee, the election of the auditors and the election of the independent proxy. So let's proceed to the election of the members of the Board of Directors under item 4 and the election of the Chairman of the Board of Directors.
As you know, the election of the Chairman of the Board of Directors and the members of the Board of Directors is conducted annually for a period of 1 year, specifically to the end of the until the end of the Annual General Meeting of the following year, so in this case, of the AGM in 2019. Under this item, we are exclusively dealing with reelections. Information on the candidates can be found in the Elections Board of Directors Curriculum Vitae brochure. So I, as a general rule, will not present the candidates. And I would like to ask you to take the floor now if you wish to say anything regarding any of the candidates proposed to be reelected under Item 4.
Of course, I will then call the candidates in the order as laid down in the invitation. So let me ask whether there's anyone requesting the floor on the general item of elections, reelections on any of the candidates. This is not the case. You will have noticed. The closer we're getting to lunch, the briefer, I'm looking around for anyone requesting the floor, but let me check again.
No one is requesting the floor. So let me declare that no one is requesting the floor on this item. So let's straight proceed to the vote under item 4.1 in the order as defined in the invitation and the agenda. Please consult with the agenda and I will announce to you the outcomes of the elections collectively at the end of all the So let's proceed to reelections. The first sub item relates to myself.
For this reason, I would like to ask our Vice Chairman, Oscar Van Gogh to take on at this point, Oscar van Gogh will speak English to you briefly, but it isn't necessary for you to for the German speaking shareholders to put the headsets on because following his statements, Mrs. Dragana Sinonovic will present the item to be voted on to you in German. Oscar, over to you, please.
Ladies and gentlemen, Doctor. Berard Hess has been a member of the Board of Directors since 2010 and has been elected Chairman of the Board of Directors at the Annual General Meeting last year. The Board of Directors proposes Doctor. Berjes to be reelected as a member of the Board of Directors and to be reelected as Chairman of the Board of Directors for a further term of office of 1 year, expiring after the completion of the Annual General Meeting 2019. Who votes in favor of this motion shall press the Yes button, who votes against the No button and who wants to abstain the abstention button.
Please confirm your vote by pressing the white Okay button and check on the
And here's the translation. Doctor. Beatrice has been a member of the Board of Directors since 2010 and was reelected or was elected as its Chairman at the AGM in 2016. The Board proposes reelection of Doctor. Beatriz as a member of the Board of Directors and its Chairman for another term of office of 1 year until the end of the Annual General Meeting in 2019.
Those who wish to go along with the Board's proposal, press the Yes button, please. Those against, choose the no button. And if you wish to abstain from voting, press the abstention button. And don't forget to press the white confirmation button to confirm and check on the display whether your vote has been recorded. Cast your vote, please.
As I said before, the results of the individual votes or elections will be announced collectively at the end. So let's move on quickly, in quick succession to reelection of my colleagues on the Board. 1st, reelection of Paul de Marais. Thank you, Oscar. Balde Mare has been a member of the Board of Directors since 2015.
The Board of Directors proposes his reelection. Let's proceed to the vote. The countdown is on now. Thank you. Next, reelection of Mr.
Oscar Fanghul, who's been a member since 2015 of the Board of Directors. And since May 2017, he's been the Vice Chairman of the Board. The Board of Directors proposes reelection. Let's proceed to the vote. The countdown is on.
Thank you. Next item is reelection of Mr. Patrick Cron, who was elected as a member of the Board of Directors of LafargeHolcim last year. And the Board of Directors proposes reelection. Let's proceed to the vote right now.
Countdown is on. Thank you. Next on the list, re election of Gerald Lamarsh, who was appointed member of the Board of Directors in 2015. The board is proposing his reelection. Let's proceed to the vote.
The countdown is on. Time is up. Next, reelection of Adrian Loder, who has been a member of the Board of Directors since 2006. And again, the board is proposing his reelection. Let's proceed to the vote right now.
The countdown is on. Thank you. Moving on to reelection of Jorg Ullias. He was elected as a member of the Board of Directors in 2014. And at the Annual General Meeting, he was reelected before he then on 10th July 2015, left the whole team Board of Directors to be elected as a member of the Board of Directors of Lafarge Holzheim in 2016.
The Board now proposes his reelection. Moving on to his reelection, The countdown is
on.
The vote is closed. The next member to be reelected is Nassef Saviras, who's been a member of the Board of Directors since 2015. And again, the Board is proposing his reelection. Countdown is on.
Countdown
live.
Thank you. Moving on to reelection of Anne Birgitte Breinberg Sorensen, a member of the Board of Directors since 2013. The Board, again, is proposing reelection of her. Countdown is on. Thank you.
Finally, the last member of the Board of Directors to be reelected is Doctor. Dieter Spalte, a member of the Board of Directors since 2003. And we are proposing to reelect him as well as the others. Countdown is on. The vote is now closed.
And bear with me until the results are established of reelections, of all of the reelections. Thank you very much. I declare that you have reelected all members of the Board of Directors at vast majorities. And I would like to thank you very cordially also on behalf of my colleagues on the Board for this expression of trust. And we won't abuse it.
Thank you
very much.
Let me also point out that all members of the Board of Directors who've been reelected have declared prior to the meeting that they were going to accept reelection. Moving on to reelection of the members of the Nomination Compensation and Governance Committee also for a term of office of 1 year until completion of the 2019 Annual General Meeting. The results of the elections will be announced collectively at the end of all the rounds. So we're going to do this in quick succession. As you know, the members, it's not the Chairman, but the members of the compensation committee have to be re elected by the AGM individually every year ever since the Minda Law was passed.
First, we are proposing to reelect Mr. Paul Desmare. The countdown is on now. Next, we are proposing reelection of Oscar Frank Ruhl as a member of the Nomination and Compensation Committee. And as mentioned already, the Board of Directors decided that in the case of him being reelected, he was going to chair this committee.
So please, can we have a countdown? The countdown is on. Thank you. Moving on to reelection as proposed by the Board of Directors of Mr. Adrian Loder as a member of the Nomination Compensation and Governance Committee.
The countdown is on. Thank you. And finally, reelection of Nassef Saviras as proposed by the Board of Directors as a member of the Nomination Compensation and Governance Committee. The countdown is on. And last but not least, reelection as proposed by the Board of Directors of Handeberg, Breinberg Sorensen as a member of the Nomination Compensation and Governance Committee.
The countdown is on. Thank you. Bear with me until the results have been established regarding all the reelections. Thank you. Again, let me declare that you have reelected all members of this committee at vast majorities.
Moving on to Item 4.3, which is about reelection of the auditors and of the independent proxy. First, we're going to proceed to reelection of the auditor. The Board of Directors propose you to again reelect Deloitte AG of Zurich as the auditors. Deloitte has declared in writing to be available as auditors for the 2018 financial year should they be reelected. Let's proceed to the vote.
The countdown is on. Press yes for approval, no for rejection or abstention for abstaining, and don't forget to confirm your vote. The vote is now closed, and the results will be announced in just a moment. You have reelected Deloitte at a vast majority. You can see the precise figures on the screen.
Moving on to item 4.3.2, reelection of the independent proxy. The Board of Directors proposes to reelect Doctor. Thomas Rees of the Rees and Ackerman Law Firm based at Yona. We're going to proceed to the vote. The countdown is on now.
Thank you. Again, a vast majority of you have voted yes. Thank you very much for your trust in our auditors. Now moving on to this is the independent proxy, Chairman said auditors. Item 5 is about compensation of the Board of Directors and the Executive Board.
1st, compensation of the Board of Directors for the next term of office. Under this item, the Board of Directors submits compensation of the Board of Directors to the Annual General Meeting, this for the next period or term of office. The Board proposes to the Annual General Meeting approval of the total maximum amount of compensation of the members of the Board of Directors for the period from the Annual General Meeting 2018 to the Annual General Meeting 2019 of a total of CHF 4,800,000. Compared to the previous year, we are proposing a maximum aggregate compensation that is 11% lower than the amount that you approved for the earlier period of compensation. This, in respect of changes on the board, you will find details in your documents for the Annual General Meeting today.
Anyone requesting the floor on this item? This not being the case, we are going to proceed to the vote. Those who wish to go along with the board's proposal, please press the yes button. If you want to reject it, press no or abstain from voting, press the abstention button. Confirm your vote by pressing the white button and check as to whether your vote has been recorded.
The countdown is on now. Waiting for the results. I declare that at a satisfactory majority, you have approved the board's motion on this item. I would like to thank you also on behalf of my colleagues on the Board. This brings us on to compensation for the Executive Board for the 2019 financial year.
Contrary to the Board of Directors, this is about the financial year 2019. The Board of Directors submits the proposal of compensation for the Executive Committee to the Annual General Meeting and proposes to approve the total maximum amount of compensation of the Executive Committee of CHF 39,500,000. For further details, see the brochure on compensation votes at the 2018 AGM. Let me mention specifically that, again, the proposed maximum amount or aggregate amount is lower than the amount that you approved last year for the 2018 financial year. In particular, we have paid heed to the fact that the number of members on the Executive Committee was reduced to 8.
Anyone requesting the floor? This not being the case, let's proceed to the vote. Those who wish to go along with the board's proposal, press the yes button. If you wish to reject it, press no. If you prefer to abstain from voting, press the abstention button and go on to confirm by pressing the white button and check whether your vote has been recorded.
The countdown is on. Thank you. Waiting for the results to be established. Thank you very much. I declare that a vast majority of you have voted in favor of compensation for the members of the Executive Committee for the 2019 financial year.
On behalf of the members of the Executive Committee, I would like to thank you very cordially for your approval and the trust you have expressed in doing so. On behalf of the entire Board of Directors, I would like to thank all shareholders and in particular, all anyone involved in organizing this Annual General Meeting. You can hardly imagine what is happening behind the scenes if you want to ensure smooth proceedings at an Annual General Meeting. Thank you very much indeed. Stay on for some time, let me tell you that you are invited for refreshments in the Foie.