Brussels, 12/12/2012 (Agence Europe) - Between now and 2014, the European Commission will launch a raft of actions aiming to modernise company law and corporate governance rules, it announced on Wednesday 12 December. Between legislative and non-legislative initiatives, it will tackle corporate transparency and the composition of their boards of governors (is the diversity of gender, age and nationality being respected?), by modifying the “accounting” directive, and the long-term commitment of the shareholders or measures aiming to boost the competitiveness of companies, for example by facilitating cross-border mergers and acquisitions. All of these areas of reflection were, amongst others, raised in the framework of a Green Paper published in 2011; the Commission brought them together in its action plan, which it adopted on 12 December.
As regards the reinforcement of transparency, the first “set” of initiatives, the Commission will propose a revision of the “accounting” directive (78/660/EEC), which will bind companies by “reporting obligations” over their diversification policy and management policy for non-financial risks. The more diversity there is on a board of directors, the greater the clash of ideas and the more vigilance, it stresses. Taking a closer look at non-financial risks will also make it possible to get a broader profile of the company, it continues. The Commission is also planning to improve information on corporate governance and the reports submitted by companies floated on the stock exchange on corporate governance, which have often come in for criticism from it. The Commission will tackle this in an action which may be a recommendation. Shareholder visibility is also part of this, with an initiative planned for 2013 on better identification of holders of stakes and shares in companies quoted on the stock exchange.
This, the text explains, will be done in the framework of the legislative work on securities law. Another action will seek to reinforce the transparency rules for institutional investors, particularly asset management companies. A proposal in 2013, possibly a modification of the directive on shareholder rights (2007/36/EC), will also look at publicity for shareholder voting and commitment policies and prior votes of institutional investors.
In order to get shareholders more involved, the Commission argues, their role in terms of monitoring the remuneration policy should be tightened up. Another legislative initiative will tackle this, and the Commission could again change its existing directive on shareholder rights. The idea is to give shareholders voting rights on officers' remuneration. Employee share-ownership is also on the agenda for reflections, even though the Commission is not planning any specific action on this point, other than taking stock of transnational employee share-ownership schemes and helping to remove obstacles to these.
For the final plank, on the framework for the cross-border operations of the EU enterprises, the Commission will decide on the issue of headquarters transfer by launching a public consultation on the matter. It will seek to find out whether legislation is required to remedy the current shortcomings which mean that moving the headquarters of company to another member state automatically affect the legal personality of the company. In 2013, the brainstorming will continue with a reflection on whether or not the rules on cross-border mergers should be changed and the same for cross-border splits, or the statute of European private company, which is still in limbo.
Lastly, also in 2013, the Commission will look at rationalising/codifying all of the major existing directives on company law. (SP/transl.fl)