New rules on Shareholders’ rights and transparency – Final European Parliament vote
Today, the European Parliament adopted the revised Shareholders ‘rights directive, which was presented by the European Commission in April 2014. On this occasion, Commissioner Jourová said: “We have learned our lessons from the past. For a stable European economy, it is essential to look beyond fast profits and focus on long-term success. The European economy and companies will benefit from the revised shareholders’ rights directive. The new European rules will prevent short-term excessive risk-taking. Asset managers and institutional investors will have to factor in long-term perspectives and more transparency in their strategies. Shareholders will have more rights, including having a ‘say on the pay’ of directors to ensure that salaries are linked to performance.” The revision of the Shareholders’ rights Directive was launched to address the shortcomings in the corporate governance of listed companies identified after the financial crisis. It will contribute to the long-term sustainability of the EU companies; enhance the efficiency of the chain of intermediaries and to encourage long-term shareholder engagement. Shareholders will have stronger rights and the new rules will facilitate cross-border voting. Shareholders will now have a “say on pay” to guarantee a stronger link between pay and performance. The revised directive will also require institutional investors and asset managers to be transparent about how they invest and how they engage with the investee companies.