Bayer CEO redeems himself by winning investor backing as chairman officially steps down

During Bayer’s first-ever virtual annual general meeting on Tuesday, CEO Werner Baumann regained investors’ backing even as the Roundup lawsuit headache remains unsolved.

About 92.6% of Bayer shareholders’ votes came in favor of ratifying management’s actions last year, while about 7.6% of those present at the meeting voted to abstain.

The confidence vote, though merely symbolic, marks a big win for Baumann as his leadership team works to pull the German conglomerate out of the Roundup litigation mire. At last year’s event, Bayer shareholders, angered by how the company had handled the Monsanto acquisition that brought on tens of thousands of lawsuits claiming the weedkiller causes cancer, cast a no-confidence vote in the execs.

This time, ahead of the meeting, top proxy adviser Institutional Shareholder Services recommended a “for” vote after recognizing the team had fulfilled its fiduciary duties and that external reviews had concluded Baumann’s team acted diligently in its Monsanto acquisition decision. Rival adviser Glass Lewis instead asked shareholders to abstain.

Baumann has repeatedly insisted that the strategic move was in Bayer’s interest, but now he’ll have to convince shareholders without a key backer of the deal, ex-Chairman Werner Wenning.

Wenning officially stepped down at the annual meeting after 54 years with the company, handing the top board position to Norbert Winkeljohann two years ahead of schedule.

“When I was in South America, I ran into a saying, which has become part of my language, ‘If it’s Bayer, it’s good,’” a reminiscent Wenning said in his farewell speech. Probably in a last showing of support for Baumann, the now ex-chairman said: “I must say, especially in these days, I really have the feeling that Bayer is very well-positioned for the future, and that I can hand over my responsibilities with a clear conscience.”

RELATED: Bayer business up in the air as COVID-19 and Roundup litigation uncertainties persist

The novel coronavirus forced the company to hold the event via webcast, and all execs were seated far from each other and the podium was disinfected after each speaker.

While investors have been continuously pressuring management to resolve the Roundup litigation to remove an overhang on its stock, Bayer recently said the settlement talks have been delayed, blaming the slowdown on the spread of the virus.

Bayer’s business in the first quarter benefited from advanced stockpiling of its medicines during the pandemic. Sales in Q1 increased by 4.8% to €12.85 billion ($13.94 billion), ahead of expectations. However, the company decided to pull its full-year guidance, citing uncertainties around the crisis.