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Led by investors responsible for assets under management of EUR 71 trillion, ICGN is a non-profit organisation that promotes high standards of corporate governance and investor stewardship. Our membership is based in more than 40 countries, and comprises asset owners, asset managers and advisers.
Stewardship is a fundamental aspect of an investor’s fiduciary duty to protect and enhance long-term value for beneficiaries and clients, such as pensioners and retail investors. ICGN defines stewardship as the responsible allocation, management, and oversight of capital to protect and enhance long-term value for beneficiaries and clients. Good stewardship contributes to corporate resilience, capital market efficiency and integrity, and sustainable economic growth.
Investors’ ability to act as responsible and effective stewards is reliant on them having rights and protections, such as the right to vote on major issues affecting the company, the right to participate in annual general meetings, the right to information, etc. We observe that some barriers to the exercise of shareholder rights remain in the European Union. These include legal and regulatory obstacles, as well as operational obstacles (such as local specificities creating complexity for foreign investors and reliance on manual processes).
We encourage the European Commission to address these issues through greater harmonisation of corporate governance and shareholder rights rules at EU level - particularly through the revision of the Shareholder Rights Directive II (and potentially a transformation into a Regulation). We also call for more coherence between various pieces of legislation. We believe that files related to financial and sustainability reporting, corporate governance, shareholder rights, and the functioning of markets should be allocated to the same Directorate General within the European Commission, to ensure more alignment in the regulatory framework in which companies and investors operate.
Enhanced harmonisation and coherence would be an important step towards the achievement of the Capital Markets Union and EU Sustainable Finance Agenda, and would help strengthen the attractiveness and competitiveness of Europe’s capital markets.