France: sixth edition of the AFG recommendations on corporate governance

L'Association Française de la Gestion Financière (AFG, the French Asset Management Association) has published the sixth edition (2008) of its corporate governance recommendations. A version in English has been published on the website of the European Corporate Governance Institute - see here. The edition in French is, however, authoritative.

Directors' liability discharge proposals - report published

Manifest, in conjunction with Morley Fund Management, has published a report titled "Directors' liability discharge proposals: the implications for shareholders". The report, to quote directly from it: 

.... addresses what for many investors has been a largely obscure issue, namely proposals to discharge directors of liabilities that routinely appear on shareholder meetings’ agendas in many European markets. We look at 13 European markets that have resolutions of this type – Austria, Belgium, Denmark, Finland, France, Germany, Greece, Luxembourg, the Netherlands, Portugal, Spain, Sweden and Switzerland; their legal basis and practical implications for shareholders in the voting context".

Europe: the harmonisation of insolvency law

INSOL Europe recently published a report titled Harmonisation of Insolvency Law at EU Law Level: see here (pdf). The report outlines differences between national insolvency laws which create difficulties for companies having cross-border activities or ownership within the EU and identifies areas where harmonisation would be desirable. The report also considers the extent to which the harmonisation of insolvency law could facilitate further harmonisation of company law.

The report contains surveys of the insolvency regimes in the UK, Poland, France, Germany, Spain, Italy and Sweden. References are also made to the law in Belgium and the Netherlands.

Europe: implementation of the Shareholder Rights Directive

The European Commission has announced that it has referred Belgium, Cyprus, Greece, Spain, France, Luxembourg, The Netherlands and Sweden to the Court of Justice for late implementation of the Shareholder Rights Directive (2007/36/EC): see here. In its press release the Commission states:

The Shareholders' Rights Directive introduces minimum standards to ensure that shareholders of companies whose shares are traded on an EU regulated market have timely access to the relevant information ahead of the general meeting and simple means to vote at a distance. The publication of documents on the internet as well as enabling proxy voting and electronic participation are important elements of this. The Directive also abolishes share blocking and introduces minimum standards for the rights to ask questions, put items on the general meeting agenda and table resolutions.

While nineteen Member States have already fully implemented the Directive, eight Member States (Belgium, Cyprus, Greece, Spain, France, Luxembourg, The Netherlands and Sweden) still have to implement some or all of its provisions. Incomplete implementation means that shareholders in those Member states do not enjoy the same rights as elsewhere in Europe and are denied the rights the Directive gives them when investing in publicly listed companies. The deadline for implementation was 3 August 2009".

France: recent developments

Freshfields Bruckhaus Deringer LLP has published a short newsletter highlighting developments in law, practice and the AFEP/MEDEF corporate governance code, with regard to female directors and board composition: see here (pdf). The newsletter notes an interesting development:

An increasing number of CAC40 companies that had previously adopted a system of management with a separate chairman and chief executive officer are now choosing to combine these roles under the authority of a single individual, while counterbalancing this concentration of power with the appointment of a 'senior independent director' (sometimes also referred to as a 'vice chairman' or 'reference director')".

France: executive pay

The Financial Times has reported, in an article titled "France eyes curbs on executive pay" (published online, 29 May):

The French government on Thursday threatened to take further action to curb pay for bosses of poorly performing companies, calling recent rises for some executives 'perfectly scandalous'.  Christine Lagarde, finance minister, called on employers to ensure that remuneration for their top managers reflected the company’s performance, suggesting further legislation if they failed to do so.  The French government intends to use its presidency of the European Union, which begins in July, to press for EU-wide rules governing executive pay, officials said, arguing that there was a head of steam building among finance ministers for a Europe-wide clampdown"

For information about the European Commission's past work on directors' remuneration, see here. Note also this earlier post.

France: gender equality on listed company boards

A report in the UK's Guardian newspaper states: "In a bill submitted to the French parliament this week, all companies listed on the Paris stock exchange would have to ensure female employees made up 50% of their board members by 2015. If passed, a gradual implementation of the law would see businesses obliged to have women in 20% of board seats within 18 months, and 40% within four years".

Europe: European Company (SE) - study and consultation

The European Commission has launched a consultation the purpose of which is to test the results of a study by Ernst & Young concerning the operation of the European Company Statute. The following background information is provided in the accompanying press release:

The European Company Statute, commonly known by its Latin name of 'Societas Europaea' or SE, was adopted on 8 October 2001, after more than 30 years of negotiation, and became available for use on 8 October 2004. A total of 431 SEs were registered as at 10 September 2009.

The SE has proved to be very popular in some Member States. Well known examples of successful SEs are Allianz, BASF, Porsche, Fresenius and MAN from Germany, SCOR from France, Elcoteq from Luxembourg and Strabag from Austria. However, in other Member States the SE has not taken off ... In order to determine whether changes are needed to make the SE Statute work better, the European Commission has launched a public consultation. With the review of the SE Statute, the Commission is aiming to increase the use of the SE across the European Union".

For further information, including a summary of the E&Y study report, see here.

France: AFG revises its corporate governance recommendations

The Association Française de la Gestion Financière (the French Asset Management Association) has published a revised edition of its corporate governance recommendations: see here. A summary of the amendments made in the new edition is available in the accompanying press release: see here. Amongst the changes is the addition of a recommendation that a lead director should be appointed to monitor conflicts of interest where the chief executive is also the chairman.

France: AFEP/MEDEF remuneration recommendations

AMF (Autorité des marchés financiers) - the French financial regulator - has published (in English) the seventh edition of its Regulation and Listed Corporates newsletter. The newsletter contains a short report on companies' compliance with the recommendations on executive compensation published in October 2008 by the French Private Companies Association (AFEP) and French Business Confederation (MEDEF).

France: 40% (minimum) of board directors to be women - Bill before Parliament

The Times newspaper reports that the French Parliament has begun to consider a Bill that will require at least 40% of the directorships at France's largest companies to be held by women. This follows the example set by Norway and, more recently, Spain (about which see here (pdf)).