Allen & Overy’s “EU Corporate Governance Report” (Survey Results)

Recently the UK law firm of Allen & Overy released its EU Corporate Governance Report, whichpresents theilluminatingresults of a survey of EU respondents' opinions on various corporate governance topics.

The document is available in BDTI's data library at:

Here are some excerpts:


Six years ago, Allen & Overy published a corporate governance report which, in the wake of Sarbanes-Oxley reforms in the United States, revealed that many senior European executives were still fearful of an Enron-type corporate meltdown. Many of our respondents told us then that the raft of corporate governance reform that followed the failures of Enron, WorldCom and Arthur Andersen had done little to improve the way businesses were run.

With so much change having occurred in the interim, we decided this year to conduct another survey, this time asking 100 senior executives from European companies for their views on corporate governance and its effectiveness across the continent. The global financial crisis has once again put boardroom behaviour under the spotlight, as well as ethical business practices and sustainability.

While governance reforms previously focused on companies, attention has now also shifted to shareholders who, like many others, are perceived to have taken their eye off the ball during the financial crisis.

Executive Summary

Almost half of European corporate executives are against the introduction of pan-European corporate governance rules. There is a stark difference of view on this issue between UK-based executives and their continental counterparts.

82% of respondents are against the introduction of compulsory quotas for women on boards.

78% believe corporate governance guidelines should only be enforced on a comply or explain basis, with just 12% wanting to see sanctions, whether civil or criminal, introduced.

57% believe investors are more engaged than ever before.

Private meetings or presentations are the most common form of engagement.

78% of executives believe institutional investors should adhere to a code of conduct and 57% believe the code should be international. 73% agree that voluntary codes have a role to play in improving standards of engagement.

77% of executives believe linking variable remuneration to performance improves company performance.

Only 11% believe that their anti-bribery policies have caused them to turn away business in the past 12 months, but 23% expect that compliance with the Foreign Corrupt Practices Act 1977, the UK Bribery Act 2010 or equivalent legislation will cause them to turn away business in the future.

The Board Director Training Institute (BDTI) is a "public interest" nonprofit in Japan dedicated to training about directorship, corporate governance, and related management techniques. It is certified by the Japanese government to conduct these activities as a regulated nonprofit. Read a summary about BDTI here, and see a menu of its services for both corporations and investors here.

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