OMV has cleared former CEO Rainer Seele of misconduct. It did find evidence of negligence in some of his actions, it said in a report.
The company was investigating Seele on three points. Possible breaches of duty may have stemmed from a “side agreement” with an OMV executive, a sponsorship agreement with Zenit St Petersburg football club and an amended gas supply deal with Gazprom Export. The sponsorship and gas deal were both dated to 2018.
Gleiss Lutz, a German law company, and hba, an Austrian law company, carried out the special audit of Seele.
The report found Seele had acted within his scope of authorisation in the gas supply deal. The audit found the CEO’s actions on the side agreement and the sponsorship were “deviations” of company guidelines.
However, he concluded both deals in a legally binding fashion.
“Despite established deviations from internal company guidelines, no actionable misconduct on the part of the former CEO could be determined,” Johannes Zink of the law firm hba said.
As a result, OMV will not sue Seele for damages.
OMV chairman of the supervisory board Mark Garett said the company had taken the allegations very seriously.
“The Supervisory Board therefore follows the recommendation of the legal experts and, as things stand today, will not instigate legal action and will propose to the upcoming Annual General Meeting that the former Chairman of the Executive Board be discharged,” Garrett said.
OMV has “sharpened our internal guidelines, which now stipulate a formal approval by the Supervisory Board for strategically significant contracts”, he said.
Too much trust
Seele became CEO of OMV in July 2015. He resigned from his position by “mutual agreement” with the board as of August 31, 2021. Alfred Stern replaced Seele as CEO.
At OMV’s AGM in June, 80.13% of shareholders voted against discharging Seele from his position on the executive board. Refusing to discharge the executive allowed OMV to consider suing Seele.
In 2021, Seele received total remuneration of 4.39 million euros ($4.39mn).
Gazprom is the owner of Zenit. International football organisations expelled the club in March this year following Russia’s invasion of Ukraine. OMV’s agreement to sponsor Zenit was said to be worth 5mn euros ($5mn) per year for five years, starting in 2018.
Seele also struck a controversial gas deal with Gazprom that year. The Russian supply contract had been due to end in 2028. OMV, taking the position that European gas demand would rise, extended the contract until 2040 with no exit clause.
Garrett, speaking in June, said that in hindsight the company had placed “too much trust” in Russia.