The European Federation of Investors and Financial Services Users, Better Finance, believes that the revision of the directive on shareholders' rights gives shareholders only limited improvements, in particular in the areas of shareholder identification and of the exercise of cross-border voting rights.
"Companies will be able to identify their shareholders and to obtain information on shareholder identity from any intermediary in the chain that holds the information. But member states will decide that companies within their borders are only allowed to request identification with respect to shareholders holding more than a certain percentage of shares or voting rights which will not exceed 0.5%. If such a high threshold of 0.5% is set by member states, only a very small minority of shareholders EU companies will be identified", Better Finance argues.
The Federation also regrets the fact that an important barrier to cross-border shareholder engagement will remain in place, despite the concerns it has expressed on a number of occasions: intermediaries will still have the right to charge higher fees to shareholders wishing to exercise their cross-border voting rights, albeit only under certain conditions.
Lastly, Better Finance laments the fact that the directive does not recognise shareholder associations and their right to represent small shareholders in listed companies.
"It is doubtful that these new rules will encourage European individual shareholders – who are long-term investors – to engage more with listed companies; a pity, as this was precisely the stated aim of this review", said Guillaume Prache, managing director of Better Finance. (Original version in French by Élodie Lamer)