10 October 2008

McCreevy - Get corporate governance principles right

“Corporate governance codes should continue to play an important role”, McCreevy said underlining that regulations “cannot be, nor should they ever be viewed, as a substitute for proper corporate governance”.

“Corporate governance codes should continue to play an important role”, Commissioner McCreevy said at the EU Corporate Governance Summit in Brussels. Regulations “cannot be, nor should they ever be viewed, as a substitute for proper corporate governance”, he said. The ‘comply-or-explain’ principle and codes of conduct fit best for promoting good corporate governance practices in the market with the need to ensure the necessary flexibility for companies, McCreevy said.

 

Risk management and remuneration are the two key areas of corporate governance where existing structures and mechanisms have been tested and found wanting, the Commissioner noted and said that the areas that will remain under the spotlight will be risk management, disclosure and transparency.

 

“We need to fix the framework and get corporate governance principles right - in particular for the financial industry - to make sure that the system functions effectively”, McCreevy concluded.

 

Full speech

 

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