European Commission plans to modernise European company law and corporate governance

On 12 December 2012, the European Commission adopted a new action plan, outlining future initiatives in the area of corporate governance and company law. The action plan sets out to improve the business environment in Europe by making sure that competitiveness and sustainability of companies are in line with changes in the economic environment.

Key elements of the action plan are as follows:

1. Increasing the level of transparency between companies and their shareholders in order to improve corporate governance;
2. Implementing initiatives aimed at encouraging and facilitating long-term shareholder engagements;
3. Conducting initiatives in the area of company law so as to support European businesses and encourage their growth and competitiveness; and
4. Merging all major company law directives into one single instrument.

Under the action plan shareholders shall receive additional rights, e.g. the right to vote on remuneration policy and to monitor related party transactions.

The full action plan, more information on the main initiatives and details on the expected timing are available here.

Dr Marco Zessel