Valgreen issued 116 reports for general meetings called during 2022, for companies listed on Bucharest Stock Exchange, Vienna Stock Exchange, Prague Stock Exchange, Warsaw Stock Exchange, Frankfurt Stock Exchange and / or London Stock Exchange.
Issues Identified during 2022
As our mission is to promote transparency and implementation of corporate governance principles, especially for listed companies, we present a summary of the particularities/issues identified for companies listed on Bucharest Stock Exchange.
Ø A very high number of general meetings (for instance Romgaz holding 13 general meetings during 2022) putting an unnecessary pressure on investors that need time and resources for preparing and sending votes.
Ø There are many companies controlled by Romanian State that have interim members of the board repetitively appointed for 4 or for 2 months. The practice is ignoring legislation in force that sets that an interim mandate cannot be extended for more than 6 months.
Ø The agenda of general meeting is amended in many cases and the investors have less than 5-7 days for voting.
Ø Many of the boards, especially in companies controlled by Romanian State (but not only) have in composition politicians or political related persons, without a proper experience in the area of activity of the company. The same practice was identified for companies listed on Frankfurt Stock Exchange, Vienna Stock Exchange and Warsaw Stock Exchange.
Ø Several members of the boards of companies listed on Bucharest Stock Exchange are overboarded, or / and publish inaccurate resumes.
Ø In many boards there are no specialists in audit or accounting, as required by regulations in force for person chairing audit committee.
Ø The process for the selection of the board’s members is not transparent.
Ø Even if the remuneration level is public, some of the companies do not have a clear remuneration policy approved by the shareholders.
Ø The culture of companies needs to be reviewed and more transparency is expected regarding the purpose, values and strategy of each company.
Ø Many of the general meetings are overlapping and the companies were not interested in adapting the timing.
Ø Appointing auditors is proposed many times without any presentation on tenure, partners rotation or audit fees proposed for next mandate.
Ø Only few companies have a gender balance statement or policy and many don’t have any target as percentage for board composition or time horizon.
2022 developments:
However, 2022 brought new developments, many of them forcing companies to adapt and evolve.
There are over 128,000 direct investors on Bucharest Stock Exchange, an all-time high for the Romanian capital market.
Physical shareholders meetings with more than 5 shareholders attending the meeting are back and the dialogue with investors during general meetings restarted.
There are more actors on corporate governance market (including Valgreen) providing proxy advisory services and publishing information on general meetings called by target companies.
The use of electronic voting extended to more companies and eVOTE or internal electronic voting solutions are highly appreciated by investors.
The number of webcasted general meetings and events for investors increased and the access using technology is an important tool for shareholders’ engagement.
There were more investors events and some of the companies invite all investors to attend (unfortunately some of the companies are continuing the practice of discrimination between investors, but maybe 2023 will bring more improvements).
Companies implemented dividend policies and shared healthy profits with their shareholders.
Valgreen 2022 annual report is published below.