INTRODUCTION
The Council of Ministers of Spain has agreed to create a commission of experts in the field of corporate governance by means of the bill ECC/895/2013, of 21st May.
Said commission shall be composed of members from the public and private sector, and they have granted themselves a term of four months in order to deliberate over different issues regarding the matter. After the deliberations of the commission, the Government shall have a term of two months to adopt the legal measures required with the aim of applying the recommendations of the commission.
BACKGROUND
The concern for the modernization of Corporate Law and improvement of the corporate governance is not new in the European Union. The effort made in this field include the establishment, in the year 2004, of the European Corporate Governance Forum (which issued its last recommendation in July 2011), the publication of different recommendations made by the UE, or the passing of the European Directive 2007/36/CE. All of the above had a relatively small impact on the legislation of the member states.
Despite the little attention paid to the recommendations, they remain the base for the creation of a system of corporate transparency. This change of course has been provoked by the financial crisis, which has shown that “the system of transparency and the application of the principle of “comply and explain”, as the great defender of the discipline, has not managed to prevent certain unscrupulous behaviour”* (*María Luisa Aparicio: “El Gobierno Corporativo ante la crisis económico financiera”).
This situation has created, among others, the necessity for the countries of the UE to “update” in the matter of corporative governance. In Spain, the creation of this commission is included in a series of measures taken, such as the transposition of the European Directive 2007/36/CE into national law, the new obligation for non –resident company directors being holders of a Foreigner National Identification number (NIE), the modification of taxation on the payment made to company directors or the modification of the Spanish Criminal Code.
SHAREHOLDERS AS AN ELEMENT OF CORPORATE GOVERNANCE
This is one of the two main matters to be discussed by the commission. With the transposition of the European Directive 2007/36/CE, the rights of the shareholders were reinforced, the issue raised now is to strengthen the role of the Shareholders Meetings in the control of the retribution of the corporate administration organ.
Ethics issues apart, recommendations from the European Corporate Governance Forum already exist for making public decisions regarding the salaries. At another level, it is possible to grant more importance to the minority shareholder vote regarding this issue.
CODE OF PRACTICE IN UNLISTED COMPANIES
The necessity to debate whether codes of good practice should be drafted for unlisted companies has been provoked, among others, by the modification of the Spanish Criminal Code, which has established a new regime of liability for legal entities.
The question is whether the code of practice and corporate compliance shall form the same code, or are to be drafted in separate documents. Likewise, the companies obliged to produce this code shall be indicated.
CONCLUSION
In November 2013, we shall have a package of measures to take in the field of corporate governance. At the moment, we do not know how the depth of the reforms, nevertheless, we can be sure that the issues hereby commented shall be considered, even if no final solution is offered.
Vilá Abogados
For more information, please contact:
27th of May 2013
