Ladies and gentlemen, dear shareholders, on behalf of the Board of Directors, I'm pleased to welcome you to the SGS 2024 AGM. This year, for the first time, the meeting is broadcasted via the live webcast, allowing shareholders who could not join us here in Geneva to follow the deliberation online. My welcome is extended to those who are joining us via the internet. During the first part of the meeting, we will share with you information about our company, our performance during the past year, and more importantly, our strategy going forward. In the second part, we will conduct the formal part of the meeting, answering your questions, and deliberate on all items on the agenda. It is my pleasure again to stand in front of you during this AGM.
I would like to take this opportunity to thank you for your continuous support and interest in our company. For you all here and also on the webcast, I would like to introduce my colleagues on stage, which is on the very right side, Frankie Ng, our departing CEO. Then we have Olivier Merkt. He's the head of Group Legal and Compliance. And most excitingly now, I'm for Géraldine Picaud, who is our new CEO as of today. I will introduce my colleagues on the board of directors during the election part.
SGS has always been a point of reference when you need to be sure, whether it's service-related to consumer electronics, the environment, safety testing, health science, critical minerals that support the energy transition, cosmetics, or medical devices. Our unparalleled knowledge, expertise, and professionalism continue to position us as global leaders in highly attractive testing, inspection, and certification industries. Today, I'm pleased to report to you that despite the challenges we had in 2023, SGS delivered strong organic growth of 8.1% and a significant increase in free cash flow. This performance has enabled SGS to maintain its highly competitive position within a growing market, and it would not have been possible without the contribution of our entire network of highly talented and passionate experts. As mentioned, 2023 has not been without big challenges. Our ability to trade has been impacted by a strong Swiss franc and slow growth in several markets.
I'm proud to report that we have responded with agility, creativity, and resilience. Our network has worked tirelessly to find and capture opportunities to drive growth across the group. Last year was the completion of our 2020 to 2023 strategic cycle. We've achieved considerable success consolidating our leadership position in Connectivity and Products , Business Assuranc e, Natural Resources , and achieving strong growth in Industries and Environment . We continue to lead the way in bringing highly innovative solutions to our customers, for example, a step change to biodiversity surveys with environmental DNA sampling and analysis. If you're wondering, eDNA, as we call it, is an innovative, cost-and-time-efficient way to detect rare, rare, and invasive genetic materials released in the environment.
We have also exceeded our goal of moving 30% of sales to our new digital laboratory information management system, a fundamental must-do necessary to maintain strong leadership within every more technology-driven economic environment. Finally, each business line has created a holistic portfolio of sustainability services to support our customers. These major successes for the group, but at the end of the day, this is a business built on people. I would therefore like to thank all our employees for their continued efforts and the passion they put into work they do every day. It is their spirit and their strengths which means we can look to the future with great positivity. I would like to highlight one topic that is particularly meaningful to me: sustainability. Last year, we became the first tech company to publish a fully integrated Annual Report providing meaningful information on financial and non-financial information.
The format of the 2023 report was further updated and improved to help stakeholders better understand the company's strategy, performance, governance, and impact for our planet. This is a clear sign we intend to do things differently. Already, our achievements in the area of sustainability are impressive, and everyone in SGS should be proud. We were the first tech company to receive approval for the 1.5 and net-zero targets of the Science Based Targets initiative, and we reaffirmed our position as leaders in sustainability by securing once again a top spot in the prestigious Dow Jones Sustainability Indices, both for the world and for Europe. These accomplishments show sustainability is truly embedded in our culture and work we do. But let me be clear: our sustainability journey is far from being completed.
For 2027, we have set ourselves even more ambitious targets because we know we must do more for the planet and for our business. This is why we are focusing our efforts on developing external solutions that will support our customers and their own sustainability journey. These solutions are organized along four key areas: carbon, biodiversity, plastics, and ESG assurance. We have also updated our overall strategy, showing the guideline to lead us successfully to 2027. Accelerating growth with trust, this will be our foundation on which to achieve our goals of driving profitable growth, streamlining the organization, and delivering attractive returns for our investors. Géraldine will present the Strategy 2027 to you in more detail.
Considering all these positive developments, the board has decided to leave our dividend unchanged, but has also taken the opportunity to propose an optional scrip dividend of CHF 3.20 per share, which is effectively a vote of trust in the new management and Strategy 2027. With our unrivaled global network and world-class professional expertise, we are in a unique position, able to respond proactively to the changing demands of our customers, while all the time staying true to our promise: when you need to be sure. Finally, please allow me to say a few words on governance. As I'm sure you know, 2024 is a time of change at SGS. At this AGM, we extend a warm farewell to our outgoing CEO, Frankie Ng, and welcome our new CEO, Géraldine Picaud, with great pleasure.
I'd like to take this opportunity to share with you a few moments of my collaboration with Frankie. When I first joined SGS as chairman, it was during COVID, which made visiting our different sites impossible. It was through Frankie and his excellent knowledge of business that I was able to gain very quickly a solid understanding of the company and its operations. During our initial meetings, I asked him directly, "Would I need to find a new CEO?" He immediately answered, "Yes." It is this honesty, this straightforward approach to business that has not only made working with Frankie a pleasure, but also has enhanced the way SGS operates. Trust and honesty are central to the way SGS operates. Trust and honesty are central to our SGS culture and work ethics, and they have been demonstrated in Frankie's leadership. Therefore, this transition has been long in the planning.
I knew from very early on that part of my mission as chairman was to find a new CEO. I also knew whoever we choose had to be an inspiring leader with a perfect blend of strategic vision and operational execution skills. In Géraldine, we have found that person. She's an exceptional leader with considerable experience and an impressive track record, and she is ideally placed to lead SGS into the future. As such, she has the board's full confidence in driving our upcoming phase and growth of profitability. Speaking on behalf of the board, I would like to formally thank Frankie for his services and welcoming Géraldine as a new CEO of SGS. I look forward to working closely with you as we take SGS forward into a bright future. We must also take this opportunity to say goodbye to Shelby du Pasquier after 18 years of excellent service.
I know you're here, yes. I would like to sincerely thank you for this relentless support, dedication, and contribution over these many years. We wish you all the best and a lot of success in the future. I'm pleased to say a lot of board members will stand for reelection as we continue to ensure the board has the necessary competencies to support the SGS future direction. This is a time of change, but we should not see it as a break with the past. Rather, by bringing Géraldine’s experience and talent to the business and setting ambitious targets for the Strategy 2027, we are committed to provide solid returns through accelerating growth and enhancing efficiency. I would like, therefore, to take this opportunity to thank the board and every single SGS employee for their concluding remarks. Thank you.
Merci beaucoup pour vos commentaires, Monsieur le Président.
Thank you for your kind words, Mr. Chairman. Ladies and gentlemen, dear shareholders, allow me to extend a warm welcome to you to this annual general shareholders' meeting. 2023 marked the end of the current strategic cycle, and I'm proud to announce that thanks to the efforts of all our colleagues, we managed to achieve our main objectives. Let me touch, first of all, briefly on the financial performance of 2023. The group delivered strong organic growth at 8.1%, and we delivered sales of CHF 6.6 billion. Adjusted operating results amounted to CHF 971 million, which is 6.2% growth at constant exchange rates. All regions contributed to this robust growth, and it represents a robust platform on which we can build the future.
If you look at sales by region, you'll find that Asia and North America achieved organic growth between 8% and 10%, and that in smaller markets such as Latin America and the Middle East, the growth rate exceeded 12%. All the divisions also contributed to this strong growth. Industries and Environment saw its growth accelerate thanks to sustainable development. In particular, in areas such as waste management, renewable energies, and verification of greenhouse gas emissions, it reinforced their leadership position in the field of minerals and benefited from strong growth in the field of technical advisory services, in particular in the field of energy transition and zero-carbon emission supply chains. Connectivity and Products also confirmed their leadership position on the growing market of cybersecurity thanks to the unique offer provided by Brightsight when it comes to security evaluation and complicated technical tests on electronic chips.
Health and Nutrition continued to gain market share in the food sector, which contributed to growth in this division. Lastly, the record performance of Business Assurance was mainly achieved thanks to the management system certification services that we provide and also our activities in the field of ESG, environmental, social, and governance, such as reporting assurance, personalized audits, and advisory, which is becoming a new major growth segment for us. This division used to be known as Knowledge. It's developed in all regions in more than 60 countries and 300 countries. Our journey towards digital transformation will continue over the next few years and will continue to strengthen our commitment in favor of innovation and collaboration. There was a slowdown in mergers and acquisitions in 2023. Nonetheless, we did make two acquisitions: Nutrasource in Canada and the United States, and seafood testing in Spain.
We also acquired the remaining minority shareholdings in Leansis and Maine Pointe. Mergers and acquisitions remain and always will be of a high priority in our approach to capital allocation, and we expect to see more activity in this area in 2024. Géraldine will be telling you more about this in a few moments. As the chairman said, I'm also going to change their behavior. That is a great opportunity for us, for the industry, and for SGS. Sustainable development is one of our six principles of conduct. It's actually rooted in our company's culture and the way we work. From the board of directors to our affiliates, we have a strong culture of governance that ensures that this always is at the core of activities.
And the culture we have encourages our employees to act and to give priority to sustainable development, both in their professional and in their private lives. Thanks to these values and the commitment of all our colleagues across the world, we've achieved our sustainability objectives in 2023, more than a decade of leadership taking up our position in all key strategic areas. Structural growth drivers in our sector are strong, and Géraldine will tell you more about the new strategy that we're going to be rolling out in the next few years. I'd like to conclude by saying a few words of thanks and by telling you how proud I am of this terrific business, this company. Years now and had a truly amazing professional journey in those 30 years.
I'd like to thank our 99,600 employees for their commitment, for their capabilities, their ability to rise to the challenges while always ensuring excellent services, delivering what our clients expect of us. You are the beating heart of this company. Thanks to your resilience, your dynamism over these 30 years, our group has transformed into a leadership position, the leader it is today. I'm convinced that one of the main reasons for this achievement and this result is the qualities. I'd also like to thank the members of the board of directors for their support during these challenging years. Their advice on market developments enabled us to improve our strategic approach and to reinforce our vision, especially in the digital field. In conclusion, I would now like to hand over to Géraldine.
Consideration I've enjoyed from you over the years, but also for the support which you continue to give to the SGS group. Thank you all very much.
Distinguished directors, ladies and gentlemen, there are two feelings uppermost in my mind as I stand before you here for the first time. First of all, a feeling of honor, the honor that the board of directors has placed confidence in me and asked me to be at the helm of the flagship that is the SGS. Today, I commit myself with strength, determination, and an open ear and an open mind to be in charge of a business, of a company, whatever its size entails, taking on and shouldering responsibilities: economic, financial responsibility, obviously, but also ethical, environmental, human, and social responsibilities.
By committing to these values as I take up my position, I'm also taking over the baton from Frankie and allow me, at this point, to pay tribute to the fantastic work he has accomplished over the past nine years at the head of the SGS. The second feeling I have is one of enthusiasm, strong enthusiasm that carries me, enthusiastic as I am, to write a few more pages of the history of the SGS, which began in 1878. At the time, Henri Goldstuck put in place a system for checking cereals as they arrived in the ports in order to ensure that the exporters were given just and proper remuneration. That was the birth of the SGS, a mission to inspect and to certify. There are vital matters at stake, such as food safety, health, technological matters, digital concerns, cybersecurity. They're all vital concerns at all levels.
Our role, our main role, is to be on top of all these vital, crucial values and concerns and to control them. What assets do we have to achieve this end? First of all, our main asset, those are the men and women who work for SGS, who constitute a wealth of know-how as well as our network of laboratories. In these laboratories, we have top-grade scientists who are fully dedicated to their mission, namely that of providing trust and confidence to our clients. We help our clients to be sure. These men, these women are obviously at the very core of our business. The second asset, I would argue, that we have is the leadership position in process certification. We hold a record number of accreditations, and these assets are all at the very core of our Strategy 2027, which I shall be presenting to you shortly.
Ladies and gentlemen, thank you.
SGS is the world's leading testing, inspection, and certification company. We're trusted by companies across a huge range of industries all around the world. They know that SGS is who you turn to when you need to be sure. Our global network means that we can respond to their needs with agility and flexibility. Four global megatrends are driving our growth. We help customers achieve their ambitions for a sustainable future. One way is by enabling the supply, enabling the safety and security of their data. We help make our customers' complex supply chains transparent and secure, enabling traceability throughout the supply chain. Finally, customers trust us to enable their businesses in the face of increasing regulation and public awareness, enabling a better quality of life. Our new strategy position.
Combining this with our unique strengths, we expect to deliver a strong performance through 2027 in line with our new targets. Whether it's helping our customers, society, or bettering ourselves, we are there when you need to be sure.
Let me now go into the Strategy 2027 with you and share some views on the company and on the industry. From there, I will give you an overview of the strategy in more detail, which is basically our roadmap for the next four years. At this stage, I will mainly provide you with key principles. We will be able to share more details at our capital market day in November. So let's start with the market. We operate in a healthy and growing industry driven by four megatrends. Firstly, there is a strong demand for sustainability.
As you know, our clients must comply with several new regulations, but beyond the law, they are pushed to adopt even more sustainable practices. Demand more manufactured products. This is true in emerging markets where the middle class is strongly growing, but also in mature geographies where we see the development of local production. Finally, companies are more and more subject to various regulations, which are typically set by local authorities. The TIC, Testing, Inspection, and Certification industry grows about 2 percentage points above GDP. So over the next four years, we see the market growing overall from 4%-5% to reach the size of $190 billion in 2027. This 4%-5% annual growth rate that you see here is a combination of regional and verticals or end markets, which we will detail now.
So as you can see here, APAC, Asia Pacific, accounts for one-third of the total market. In this region, growth has been historically driven by consumer products. Consumer products will remain a strong engine in the coming years, supported by demographic trends, especially the urbanization and the development of upper middle class. Asia Pacific also contains other significant end markets, such as environmental, and we expect the region to be a major contributor to digital services. Europe. Authorities requiring quick adoption of fairly complex rules. About North America, we believe that the reindustrialization of the U.S. has just started, and this trend benefits from federal and state incentives. Latin America and Middle East Africa are smaller markets. They remain. Let's move now to how SGS is positioned to capture the huge opportunities. As you know, we are the global market leader with well-established positions in all geographies.
We have a strong network, especially in Asia, which positions us ideally to respond to the domestic market demand. More generally, our implementation allows us to follow any change in the supply chain. We are also the leader in the solutions, which guarantee data integrity, and we will detail this as well in a few minutes. So as I said, we have great trends, and we operate in a market with fantastic opportunities. We have defined three levels on which we will build our near future. Firstly, we will capture the growth coming from the market megatrends, sustainability, digital supply chain, all this on the back of a heavily regulated entity, Plastics and ESG, what we call ESG assurance. In digital, we are seeing rapid growth with swift technological advancements and widespread adoption of new technology across all industries. We are already a leader in cybersecurity evaluations and microchip testing.
In new technologies like artificial intelligence, we focus on building trust through rigorous digital trust and data integrity services. In terms of geographies, we have a presence in Asia, and we will continue to focus on attractive opportunities locally there. We also have a strong ambition to grow our share of the group sales in 2027 in North America, which is a fantastic, fast-growing market. This will, of course, require investment, and I will come back to this later. It's key. We will implement a high-performance and cash culture across the group and have already introduced new incentives based on group performance targets. We have also decided to eliminate some functions which currently participate in the duplication of responsibilities. We are talking here about support functions, not about experts.
Together with the continuous efforts of process optimization, we expect to realize CHF 100 million of cost saving at current scope. I'm taking this opportunity to extend a warm welcome to the three very experienced leaders who are joining our group: Rafael Navazo, new head of Latin America; Marta Vlatchkova, new chief financial officer; and Martin Oesch, new group general counsel from May 2024. I take this opportunity to extend to Olivier Merkt, who will retire at the end of April, our gratitude for his invaluable contribution to SGS over the last 23 years. And on a more personal note, Olivier, my heartfelt thanks for all your support over the last few months. This slide summarizes where these strategic priorities lead us. In terms of growth, we believe we will overperform the market thanks to the trends I just went through.
We are targeting to deliver an organic growth of 5%-7%, which we expect to combine with M&A growth. We will not take any quantified commitment on this, obviously, now. The priority is to execute the right targets at the right time and at the right price. Information in November at our capital market day. Finally, the cash, cash generation, which we measure here as free cash flow after lease divided by EBITDA after lease, will exceed 50% each year. Our growth ambitions, especially on the portfolio, with the relaunch of our M&A program, will need some financing. We can count on solid cash flows in the coming years, and the key priority will be to remain strong to reflect what SGS is about. For example, let's take the environment. We are an environmental leader because we are fundamentally a non-polluting business.
Starting from the fact that we are already successfully addressing our Scope 1 and 2 emissions, those are just not about numbers. They represent our commitment to creating a sustainable, inclusive, and responsible future. Finally, I would like to express my utmost gratitude to you, shareholders of SGS, for your continued support. It is truly an honor for me to stand here today as your new CEO. You have my full commitment, and I have no doubt that together we will drive SGS into a new phase of growth and profitability. Thank you very much for your attention.
Thank you very much, Géraldine. We are looking forward still. Our General Counsel of the company, he will act as the secretary of the meeting. So I would like to invite him to inform us about the formalities of this meeting.
Let me begin by noting that this AGM was called, as provided for in the Articles of Association , namely by letter to shareholders. So it's validly constituted and has the authority to deliberate on all items on the agenda. Maître Corinne Rosset, a notary, has been entrusted with the task of authenticating the decisions taken by this AGM, which relate to agenda items that imply an amendment to the Articles of Association . Let me also welcome our statutory auditors, PricewaterhouseCoopers, represented today by Mr. Guillaume Nayet, senior. He has been appointed independent proxy. In other words, he represents the votes of shareholders who are not able to attend the AGM and who are being represented by him. Now, the list of attendants or the numbers should shortly be displayed on the screen. Before we move.
Speaking time by potential speakers to group questions together and also to close the debate so as to avoid any unnecessary prolonged discussions. Should you wish to leave the room during the discussions, the shares that are recorded on your Televoter will be taken down and discounted from the vote. That way, it will be possible to determine exactly what sort of majority is required for each of the items that is put to the vote. Votes, again, will be using an electronic voting system. You have been given a voting card when you entered this hall. We will only use them in the unlikely event that the electronic voting system fails. So you have a voting card, but you also have a remote voting device. This Televoter has already got the number of votes you represent recorded. I'm going to show it to you. Green button stands for yes.
The orange one is abstention, and the red one is. And that was done when you entered this hall because you want to make sure that your voting faithfully reflects the voting instructions you received. If you haven't done it, you still have the possibility of registering those votes.
That was communicated with the meeting invitation and which is displayed on the screen. I will not go through the details, but do you have any questions to the agenda? There is no objection, and therefore I'll consider the agenda as adopted.
In the interest of efficiency, I suggest that we group all questions and deliberations on several points of the agenda and that we will first address any questions regarding item number 1 and 2 of the agenda relating to the approval of the financial statement, the report of non-financial matters, the Remuneration Report , and the release of the board of directors. After having addressed questions and remarks regarding these topics, we will move directly to the votes of the proposed resolutions related to these agenda points. I open the deliberation on the financial statement, the report on non-financial matters, the Remuneration Report , and the discharge of the board of directors. Are there any questions? I don't see any questions, so I am back to you.
Thank you, Chairman.
You will have had an opportunity to read the Annual Report, financial statements of SGS SA, and the consolidated financial statements of the group. You find them all in the management report, and if you wish to consult this, you will also find them on the company's internet site. You will also have had an opportunity to read the report from our statutory auditors, namely PricewaterhouseCoopers, on the financial statement of SGS SA as well as the consolidated accounts for the group for the 2023 fiscal year. These reports are also all contained in the management report, and you can consult them online. Would the representative of PricewaterhouseCoopers like to add anything to the written report? No? Thank you very much, Mr. Nayet. We're going to vote on all the items under this agenda item in one ballot.
I will ask you now to please wait to hear the instructions before you use the Televoter. The proposal is as follows. The board of directors proposes that this AGM approve the Annual Report, the financial statements of SGS SA, and the consolidated financial statements of the SGS group. May I now ask you to cast your vote? You have 5 seconds to think about it, and then you may cast your vote. The ballot is closed, and the result will appear on the screen. There you are. Very sound approval of the proposal from the board on agenda item one. The second item is the Annual Report on non-financial matters for 2023. Since 2008, SGS has been publishing a report on sustainability, and since 2018, we put out an integrated report with information on both financial and non-financial matters relating to the group.
The information and data in the integrated Annual Report cover much more than what is actually required by Swiss law, and you have a table which tells you which parts of the report cover the areas which are actually required by Swiss law. I would also like to add that our report on non-financial matters was audited by the external auditors, by PwC, in order to have an independent view on the non-financial aspects of the report. The board of directors' proposal is that the assembly approve the report on non-financial matters for 2023. You now have a chance to cast your vote and have five seconds in which to consider how you wish to vote. The ballot is closed, and the result will appear shortly. There it is. Approval. The resolution, the proposal is approved.
We are now going to move on to the advisory vote on the 2023 Remuneration Report. You will have had an opportunity to read the company's Remuneration Report. It's appended to the SGS group management report. It has been audited by our statutory auditors, and their conclusions are also to be found in the annual group report. This is actually an advisory vote on the part of the AGM. It gives you an opportunity to state your views on the SGS group's policy in matters of remuneration, as set out in the report. The proposal from the board of directors is that you accept the 2023 Remuneration Report. You now have a possibility of casting your vote. The ballot is closed, and I note that the proposal from the board and the report have been approved.
Let us now move to agenda item two, which relates to release of the board of directors and the management from liability. This vote on the release applies to members of the board of directors and the executive committee who are involved in management during all or part of the 2023 fiscal year. According to statutory provisions, these persons are not entitled to take part in the vote, and that applies to all the shares which they hold or represent. Members of the board of directors and people who are close to them are not entitled to take part in the vote on release of the board of directors and the management either. Unless there are objections on your part, we're going to vote in one ballot to release from liability all members of the board of directors and the senior management.
The proposal from the board of directors is to vote release of the members of the board of directors and of the management. Please, would you now cast your vote in the five seconds you have for this purpose? The ballot is closed, and the result will be there. In fact, it is here. The proposal has been approved. Mr. Chairman, that concludes this first part, and I give you the floor.
This year, the board of directors proposes to allow shareholders to choose between payment of their dividend in cash and in form of distribution of shares. For these reasons, we will be asked to approve simultaneously the appropriation of profits, a share capital increase, allowing the company to distribute shares to shareholders to opt to receive shares.
We will also ask the shareholders to approve the cancellation of treasury shares which are acquired by the company during the past share buyback programs. We will now address any questions regarding items 3.1 to 3.3 of the agenda, dealing with the distribution of dividends and share capital increase and share capital reduction. I now open the deliberation on these topics. Are there any questions? This seems not to be the case. I would now like to hand over to Ariel Bauer, Group Vice President of Investor Relations.
Monsieur le Président, je crois que ce n'est pas nécessaire.
Ce n'est pas nécessaire, sorry.
This is not necessary. If there are no questions on the scrip dividend, I think we can move on directly to the proposed resolutions.
La première résolution, 3.1, concerne l'emploi du bénéfice résultant du bilan et la distribution of profit resulting from the balance sheet and distribution of a share or cash dividend. The amount available to the AGM on the basis of the 2023 accounts is displayed on the screen. I won't read it out to you. You can see it there on the screen. The board of directors proposes to the AGM to declare a dividend of CHF 3.20 per share, and as was explained in the invitation to this AGM, declared dividends will be distributed to eligible shareholders according to their preference, either in cash or in the form of shares which will be created and issued and circulated for that purpose. For this reason, the general AGM is asked to authorize a share capital increase in order to be able to distribute the dividend.
The decision on distribution of dividends, therefore, is subject to your approval of an increase in the share capital. The balance available after the distribution of the balance will be carried forward. No dividend will be paid on shares held by SGS SA or by any companies under SGS SA's direct or indirect control. May I remind you of the following? If the proposal is accepted, a gross dividend of CHF 3.20 per share will be paid on the 25th of April next, and depending on what shareholders prefer, it will be paid out either in cash without any fees, but there will be the 35% withholding tax deducted, or else it will be paid out in the form of scrip shares for an amount which corresponds to the value on the stock market for the determining period with a discount of 6%.
The board of directors proposes to this AGM approval of the following resolution concerning the appropriation of profit, and I'm going to put this matter to the vote. Would you please cast your vote in the next five seconds? The ballot is closed, and the result will appear on the screen. Here it is. Appropriation of profit resulting from the balance sheet and the option of a distribution of a scrip dividend is massively approved. Let us now move on to item 3.2 on the agenda, the share capital increase. The board of directors proposes to increase the share capital of the company in the form of an ordinary increase of the share capital for a maximum amount of CHF 360,000 by the issuing of a maximum number of 9 million ordinary registered shares of the company with a par value of 4 centimes apiece.
The shares thus created will be used exclusively for the payout of a dividend to eligible shareholders who would have opted for this form of dividend. The shares will be issued at their par value. Preferential subscription rights will be excluded. This will allow the company to use this for the distribution in the form of dividend to shareholders who are eligible and who would have chosen this form of getting their dividend paid out. The board of directors proposes that the AGM approve the proposal from the board, namely to agree to the increase in share capital. You have five seconds now in which to cast your vote on this matter. The ballot is closed. Here too, overwhelming approval, and that marks approval of the payout of the dividend because the proposed payout of the dividend was dependent or contingent upon your approval of this increase in share capital.
Let me now move on to 3.3, which is share capital reduction. The board of directors asked the annual general meeting to approve a reduction in share capital by cancellation of shares which were bought as part of past share buyback plans. They can no longer be circulated or used for the payment of a dividend without this having unfavorable tax consequences. The board of directors, therefore, thought it would be appropriate to request approval from the AGM to reduce the share capital in order to and to do this by cancellation of these bought-back shares. The AGM has, therefore, requested to approve the proposal from the board of directors on the matter of reduction of share capital. Please cast your vote in the next five seconds. The ballot is closed. I note that the request for a reduction in share capital has been approved.
We will now address all questions and deliberations regarding the elections of the board of directors, the chairman, the members of the Remuneration Committee , the statutory auditors, and the independent proxy. We will now address all the questions regarding these items, and I would like to ask you if there are any questions to these topics.
Monsieur le Président, Madame, Mesdames et Messieurs. Mr. Chairman, Madame, Ladies and Gentlemen, my name is Frédéric Weber. I'm a former employee or director of Lombard Odier. I would like to speak to the need for SGS to maintain its good reputation, namely the reputation of the SGS in terms of safety and security, and I also like to refer to agenda item five on remuneration. Under Swiss law, control by shareholders of remuneration considered excessive for executive committee members or boards of directors.
Well, these regulations have these remunerations have grown so high that some directors and managing directors have been pushed to take far too risky decisions in order to be able to pay these excessive fees, and I think that's one of the reasons for the failure of Credit Suisse. That is why I will often be voting abstention and sometimes no to these proposals. May I ask what you're planning to do to improve this reputational matter and security? And secondly, I wanted to say something about the membership of the board of directors. There was a tendency to recruit a Swiss member, maybe have a Swiss national as chairman or managing director. That used to be a tradition. Thank you very much. I would like to take this into account and to put my comment into the minutes of this annual general shareholders' assembly.
Alors, sur le plan de la rémunération, donc nous avons expliqué de façon. On the issue of remuneration, we've explained quite extensively and quite specifically the principles that govern remuneration in our company. Nous procédons à un nombre de votes pour avoir votre avis d'actionnaires. Nous demandons d'approuver le rapport de rémunération. We proceed in a number of votes so that we get your approval. You approve the report on remuneration. It's an advisory vote, but it gives you the opportunity to express yourself on this issue. You can approve separately the remuneration of the board of directors from if my memory serves me well, it hasn't changed in the past five years. You approve the fixed remuneration that goes to senior management. You retrospectively approve the variable remuneration going to senior management. So that happens retrospectively. You approve long-term incentive plans that are issued.
If we were to compare with other companies, the amounts that are put to your votes, but of course, you may judge differently, are fairly low in the bracket applied by other Swiss companies. You will have the opportunity to take the floor when we deal with these items on our agenda. I think SGS is fully playing its role as a responsible company when it comes to the remuneration of its management. None of the remuneration mechanisms would lead us to take unreasonable risks. So that's for the first part of your question. Now, to come to the second part of your question, the membership of the board of directors and the issue of Swiss nationals. We're a multinational company. We're present in more than 140 countries. It is useful both for the company and for its shareholders to have two things.
On the one hand, to be very present in Switzerland. It is our country, and we do have a chairman and members of the board who play this role. We have members of senior management who are Swiss nationals too. But it is also very important, maybe even more so, to reflect the diversity of our network, of our customer base, and our global footprint, all our employees around the world. And so what I want to say is that SGS does manage to achieve this balance between presence in Switzerland and diverse representation within our management bodies. Mr. Chairman, would you like to say something? I think it's an important question, and I can say Ich kann Schweizerdeutsch sprechen. So I'm a true Swiss, if you may say so. And I think our heart beats also as a Swiss enterprise.
Of course, we have an international role, so we have to deal with the international environment. That's why we also have expertise on our board, which are internationally oriented. But I mean, in our hearts, we are a Swiss enterprise. And by the way, SGS also, and we had that discussion, that we pay dividends in hard Swiss currencies. And I tell you, this is quite a challenge. And this means for us also that we have to make sure we don't take these risks, as you say, that we earn our money. And we are very strict also in the Remuneration Committee , and we have these discussions with the Remuneration Committee , that we are very clear on the targets. And we are very clear that the risk is well presented also in these remuneration targets.
So if we compare with other companies, as you mentioned, I don't really like too much to be compared with banks. I think it's a very different business we are in. But I can also assure you that this is in our fundamental heart to really make sure that we don't take these risks and we are a very solid company. I mean, if you look at our company as it has evolved, I think we almost sometimes compared as an option. And I think we should maybe take a little bit more action, grow the company again, not to take risks, but to make sure we are within the markets and we obtain a good market share. So I hope you can approve our answers. Thank you very much for your questions. Thank you. Are there any other questions? Thank you very much, and we really appreciate your involvement.
So I would like to hand over back to you, Olivier, for these topics. Merci, Monsieur le Président. Thank you, Mr. Chairman. I'm now going to move on to agenda item 4.1, which relates to elections to the board of directors. I'm now going to ask you, shareholders, to elect each of the members of the board of directors for a term which runs until completion of the 2025 AGM. In accordance with the Articles of Association, elections to the board of directors is the second stage, consists of the AGM designating from amongst the elected board members the chairman of the board of directors and the members of the Remuneration Committee . The board of directors has been informed of the fact that Mr. Shelby du Pasquier has chosen not to run for re-election.
The board of directors would like to thank him, and I too would like to thank him warmly for his contribution to the development of our company and the many 18 years that we have had the privilege of working together with you. The board of directors proposes that you re-elect the eight directors who are available for re-election for a further term of one year, which runs until. Before the time is up, another two seconds. Thank you. The ballot is closed. I'm now going to ask you to cast your vote in favor of re-electing Madame Phyllis Cheung. You have five seconds to cast your vote. The re-election of Mr. Ian Gallienne , the resolution is before you. Would you please cast your vote in the next five seconds? Le scrutin est clos. The ballot is closed. L'administration de Monsieur. Le scrutin est clos.
The ballot is closed. La prochaine résolution concerne. The next proposal is to re-elect Miss Kory Sorenson as a member of the board of directors. The proposal is before you, and you have five seconds in which to cast your vote. And now, lastly, you have before you the proposal to re-elect Miss Janet Vergis as a member of the board of directors. You have the resolution up on the screen, the proposal on the screen. You have five seconds to cast your vote. Le scrutin est clos. The ballot is closed, and all the results for the eight candidates will come up on the screen shortly. There it is. And I note, and you can see it behind me on the screen, all the members of the board of directors have been re-elected for a further one year term.
The next item on the agenda is election of the Chairman of the Board of Directors. The proposal from the board is to re-elect Mr. Calvin Grieder for a term of one year as Chairman of the Board of Directors. Would you please now cast your vote as to this proposal in the next five seconds? Le scrutin est clos. The ballot is closed. Et je constate que Monsieur Grieder. I see that Mr. Grieder has been re-elected for a further term of one year. Moving on to item 4.3 on the agenda now, that's the election of the members of. Proposed for election as members of the Remuneration Committee . Here too, we will ask you to vote individually for each of the candidates, but the result will be published for all three at the same time. So the first proposal before you is the re-election to the remuneration.
Next proposal relates to the re-election as a member of the Remuneration Committee of Madame Kory Sorenson. It's now before you. Please cast your vote on this proposal. You have five seconds. The ballot is closed. The outcome of this election will. Vote. Le scrutin est clos, et je constate, Monsieur Maillet, que PricewaterhouseCoopers a été bien réélu. Nous allons finalement clos. We will close this round of them, and for the AGM, we're to. Je vous propose de vous prononcer sur cette résolution. I'm going to ask you to vote on this resolution, and you have five seconds to do so. Le scrutin. Score. Bravo. It is the independent proxy who gets the highest score. Well, congratulations. We will now immediately address the next topics, which are the questions and deliberation regarding the remuneration of the board of directors and senior management of the company.
We will therefore address first any questions and remarks regarding the items 5.1 to 5.5 of the agenda. We will then submit all relevant resolutions to the vote of the meeting. Are there any questions? Ainsi que cet exposé dans le rapport de rémunération. It's stated in the Remuneration Report. Members of the board of directors receive a fixed remuneration element and an additional fee if members of the board of directors are also part of one of the board's committees. Demande. Paid by the company and partly paid by the directors.
In accordance with its Articles of Association, the company may pay part of its remuneration to its directors by way of registered shares. An amount corresponding to 25% of the basic remuneration of members of the board shall be paid out as shares whose sale is restricted for a three-year period at the same conditions as shares granted to members of. La résolution was adopted. We're going to pass it now to point 5. Let's move on to item 5.2 on our agenda. It has to do with the fixed remuneration of senior management. Conformément aux dispositions de nos statuts. In accordance with our Articles of Association, we will ask you to vote on fixed remuneration to senior management for fiscal year 2025. The board of administration proposes to set a maximum aggregate amount to the tune of.
To approve the resolution that appears on screen, which is about the maximum aggregate amount of fixed remuneration for members of senior management, including the CEO, for 2025. You have five seconds. Le scrutin est clos. The vote is closed. La rémunération fixe a été approuvée. The amount of fixed remuneration has been approved. This amount can be paid partly in cash and partly by granting restricted shares. Following these explanations, I kindly ask you to approve the resolution that appears on the screen behind me. I kindly ask you to cast your vote in the coming five seconds. Le scrutin est clos. The ballot is closed. Le résultat va apparaître. The results should be appearing shortly on screen. Le résultat a été approuvé.
It's now up to you to approve the issuance of a long-term incentive plan for members of senior management in 2024 for a total amount of CHF 12 million. The board of directors kindly asks you to authorize the issuance of such a long-term incentive plan by granting share units to members of the senior management whose vesting will be contingent on the group's ability to reach long-term financial and non-financial objectives. Le scrutin est clos. The ballot is closed. We now move on to item 5.5. Sorry, I forgot the results. Nous avons effectivement eu une confirmation de l'approbation des résolutions. You have confirmed that you approve this resolution. We now move on to item 5.5 of our agenda, which has to do with the long-term incentive plan to be issued in 2025. The board of directors asks you for the approval to be granted in advance.
With the new system, this approval would be requested a year ahead of time for long-term incentive plans to be issued during the calendar year following the AGM. Because of this change and during a transitory period, the board of directors exceptionally asks you to approve the issuance of two long-term incentive plans in a row, one for the current year, the second one for the year to come in 2025, and you have five seconds to do so. Le scrutin est clos. That's time up, and the result is now up on the screen. These are the questions and remarks regarding the proposed revision of the company's Articles of Association as per item number 6.1 and 6.2 of the agenda. We will then submit all relevant resolutions to the vote of the meeting. Are there any questions on that topic?
Doesn't look like, so let's go to the last point. Tout d'abord, le point six. First of all, item 6.1 on the agenda relates to amendment to remuneration, different elements, remuneration for the senior management. I think it's good to have this greater accuracy because the company asks for separate approval for fixed remuneration, annual variable remuneration, and not wait for the next annual general assembly to do so. It will bring our company into line with the practice in other companies, and therefore the board of directors proposes that the AGM approve amendment to articles 28 and 31 of the Articles of Association to the ones which relate to remuneration for the. Le scrutin est clos. Time is up. There you are. Here is where our notary comes into play. Would you please authenticate and take note of this amendment to the Articles of Association?
Now, I'm going to move on to item 6.2, where the Articles of Association of our company need to be revised on a number of administrative points, their provisions which deal with administrative matters. And for articles 5 ter, 11, 12, 13, and 39 of the Articles of Association are the articles which would be affected by this amendment. I'm now going to ask you to cast your vote in the following five seconds. Le dernier résultat. Closes the vote, and the results are up on the screen. This proposal has been accepted by the shareholders. Thank you, Mr. Chairman. Thank you. The room, I kindly ask you to hand back your televoters as well as your headsets upon exiting the room. A little cocktail which will be served for all the ones that are here. Sorry, not when you are on the webcast.
Here in the restaurant Il Vero of this hotel, the Fairmont Grand Hotel Geneva here in Geneva. Ladies and gentlemen, dear shareholders, thank you once again for your attendance, and with this, I declare this meeting as ended. Thank you.