ICGN: EU listing Act comment letter

04 April 2023

ICGN is concerned by the ‘race to the bottom’ by relaxation of past multiple voting rights limitations is regarded as justified to attract market listings. Stock exchanges, underwriting community and issuing companies may benefit. But at the expense of shareholder rights and investor protections.

Re: Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on multiple-vote share structures in companies that seek the admission to trading of their shares on an SME growth market
And
Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2014/65/EU to make public capital markets in the Union more attractive for companies and to facilitate access to capital for small and medium-sized enterprises and repealing Directive 2001/34/EC
The International Corporate Governance Network (ICGN) appreciates the opportunity to comment on the final proposals noted above that are part of the Listing Act package, containing “a set of measures to make public capital markets more attractive for EU companies and facilitate access to capital for small and medium-sized companies (SMEs)”.1
Established in 1995, ICGN’s purpose is to convene capital market participants to develop, promote and embed high standards of corporate governance and investor stewardship worldwide to preserve and enhance long-term value, contributing to sustainable economies, societies, and the environment. ICGN Members, many of whom are investors responsible for assets of around $70 trillion, are based in over 40 countries - largely in Europe and North America, with growing representation in Asia. For more information visit www.icgn.org.
ICGN’s work programme is guided by the ICGN Global Governance Principles2 and the Global Stewardship Principles3, both of which are developed in consultation with ICGN Members. The ICGN Global Governance Principles were referred to in the EU Corporate Sustainability Reporting Directive (recital 44) as an authoritative global framework of governance information of most relevance to users. Many ICGN Members refer to the ICGN Global Governance Principles in their corporate governance assessments, proxy voting policies and company engagements. The Principles also inform governments and regulatory agencies on internationally accepted standards to help inspire the evolution of national corporate governance codes.
With respect to the above consultations, please note our response below the proposed changes in bold:...

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