| The European Corporate Governance Forum, established last October to examine best practices in Member States with a view to enhancing the convergence of national corporate governance codes and restoring confidence in capital markets, has announced the outcomes from its second meeting. The Forum, which comprises corporate governance experts from across the EU including industry professionals, regulators and academics, discussed issues on shareholders’ rights and risk management.
On shareholders' rights, the forum focussed attention on achieving an appropriate balance between the roles of shareholders and senior management. As such, the Forum stated that a broad analysis of shareholder powers needs to be conducted to assess the impacts of different shareholder voting models on corporate governance.
On risk management and internal control, the forum stated that the increase in disclosure requirements and the need to establish audit committees being introduced in the 4th, 7th and 8th Company Law Directives, are viewed as essential to progress towards making improvements in corporate governance. However, the forum also said that prior to implementing further legislation, lessons should be learned from past experiences to ensure there is balance between the cost of additional requirements and the benefits they would deliver.
Further information on the European Corporate Governance Forum can be found on the European Commission website.
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