General Meeting Season Review - Europe 2018

October 2018 / D.F. King

The 2018 UK and European proxy season demonstrated that corporate governance continues to evolve toward greater accountability by boards, not only toward their shareholders but also toward the wider stakeholders affected by them.

In all the major corporate governance topics that one encounters across the region such as board elections, listed companies have strived to reinforce their corporate governance capital by becoming more transparent, explaining how their boards operate and interact with executive management, listening to the expectations of their investors, and by engaging with both their internal and external stakeholders.

We’ve also seen institutional investors increase their stewardship responsibilities through more regular engagement with issuers and with a far greater number of companies across the region. These minority investors want to be heard and leave an indelible mark on the shape of corporate governance on almost every subject of the day. Whether it be through increased staffing of their corporate governance departments, an increased emphasis on ESG, or simply a bespoke voting policy with proxy advisory firms, institutional investors have become more independent and individual in their voting decisions and about the subjects that are important to them.

The corporate governance debate has expanded to a wider audience too. With less faith in Adam Smith’s agent/principal model and the limits of self-policing, the conversation has opened up to stakeholders, and regulations have become far more prescriptive. Certainly, some of the impetus relates to the gradual implementation of the EU Shareholder Rights Directive, but this movement remains rooted locally in a general desire to see the creation of shareholder value through improved transparency and greater accountability. If corporate governance is healthier today, the demands on listed companies continue to grow, especially in a more prescriptive environment.

Now more than ever, it is essential for companies to lever all the corporate governance tools at their disposal to tell their story, explaining their governance so that investors and stakeholders alike understand how their model creates growth for shareholders and why they are good corporate citizens.

David Chase Lopes, Managing Director, EMEA
D.F. King
e:david.chaselopes@dfkingltd.com
t: +33 6 72 54 69 79

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