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IP/04/1241

Brussels, 18th October 2004

Corporate governance: Commission creates European Forum to promote convergence in Europe

The European Commission has set up a European Corporate Governance Forum to examine best practices in Member States with a view to enhancing the convergence of national corporate governance codes and providing advice to the Commission. The Forum comprises fifteen senior experts from various professional backgrounds (issuers, investors, academics, regulators, auditors, etc.) whose experience and knowledge of corporate governance are widely recognized at European level.

Internal Market Commissioner Frits Bolkestein announced the creation of the Forum today at the High Level European Corporate Governance Conference organized by the Dutch Presidency in The Hague (see SPEECH/04/460).

Mr Bolkestein said: “The more national corporate governance codes converge towards best practice, the easier it will be to restore confidence in capital markets in the wake of the scandals that have shaken trust in some European companies, including traditional “blue chips”. Broad convergence not only strengthens shareholders’ rights and the protection of third parties such as creditors and employees, it makes it easier for investors to compare investment opportunities. That leads to a more efficient allocation of capital, which matters to everyone because it is the basis for creating growth and jobs. The time is ripe for this initiative, as many Member States are reviewing their own corporate governance codes. The Forum with its distinguished membership, will be well placed to help build consensus on key issues. This work is not a precursor for a European corporate governance code, but it is a drive to raise standards across the board. The Forum will help us achieve this without bulldozing national traditions or forcing anything down anyone’s throat.”

Members of the Forum have been appointed for three years. The Forum will meet, under the chairmanship of the Commission, two to three times a year and will deliver a yearly report to the Commission.

The Action Plan on ‘Modernising Company Law and Enhancing Corporate Governance in the European Union – A Plan to move forward’ (see IP/03/716 and MEMO/03/112), adopted in May 2003, outlined the integrated approach that the Commission intends to follow in the area of company law and corporate governance. The creation of the European Corporate Governance Forum is one of the measures designated by the Action Plan for the short-term.

In the last few weeks, also as part of the implementation of the Action Plan, the Commission has published Recommendations on increasing the transparency of directors’ remuneration (IP/04/1183) and on the role of independent directors (IP/04/1182) as well as a strategy to prevent financial and corporate malpractice (IP/04/1164). It will shortly also be bringing forward proposals to amend the Accounting Directives to establish the collective responsibility of board members, increase disclosure of certain transactions and of off-balance sheet arrangements and require listed companies to include a “corporate governance statement” in their annual report.

Annex

Members of the European Corporate Governance Forum

- Antonio Borges (PT), Vice Chairman of Goldman Sachs International and board member for several corporations

- Igor Adam Chalupec (PL), President of the Management Board and CEO of PKN Orien (energy company)

- Bertrand Collomb (FR), Chairman of Lafarge and of ‘Association Française des Entreprises Privées’ (AFEP)

- Gerhard Cromme (DE), Chairman of the Supervisory Board of ThyssenKrupp, President of the German Corporate Governance Code Commission

- David Devlin (IE), Partner PwC, Chairman of the ‘Fédération des experts comptables européens’ (FEE)

- Emílio Gabaglio (IT), Former General Secretary of the European Trade Union Confederation

- Jose Maria Garrido Garcia (ES), Head of Legal Service and Secretary to the Governing Council, CNMV (Spanish securities and exchange commission)

- Peter Montagnon (UK), Head of Investment Affairs, Association of British Insurers

- Colette Neuville (FR), Chairman of ADAM (Association de défense des actionnaires minoritaires)

- Roland Oetker (DE), Chairman of DSW (German Association of private investors)

- Alastair Ross Goobey (UK), Chairman of ICGN and of Hermes Focus Asset Management Ltd

- Rolf Skog (SE), University of Stockholm

- Andreas Trink (EE), Chairman of the Management Board of the Estonian Financial Supervision Authority

- Jaap Winter (NL), University of Amsterdam

- Eddy Wymeersch (BE), Chairman of CBFA (Belgian SEC) and member of the Committee of European Securities Regulators (CESR).


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