Citywire printed articles sponsored by:
View the article online at http://citywire.co.uk/wealth-manager/article/a714457
FCA 'empowers' minority shareholders with new listing rules
by Dylan Lobo on Nov 05, 2013 at 10:45
The Financial Conduct Authority (FCA) has strengthened its listing rules to enhance protection for shareholders.
The new rules will give shareholders in 'premium listed companies' - those that meet the highest standards of transparency and corporate governance- additional voting rights and greater influence over key decisions.
The proposals follow a consultation by the FCA's predecessor, the Financial Services Authority, last October.
The consultation responded to concerns from the investment community over the governance of premium listed companies with a controlling shareholder and the rights of minority shareholders.
The FCA has balanced these concerns with the feedback it received across the market to develop focused measures that strengthen the voice of minority shareholders, without turning minority protection into minority control.
The new regime will be based around four key pillars.
* Ensuring listed companies are run independently of their controlling shareholders. This includes measures that give independent shareholders a veto over transactions between listed companies and a controlling shareholder when this independence is threatened.
* The requirement of separate approval of independent directors by independent shareholders, in addition to gaining approval from shareholders as a whole.
* Enhanced voting power for minority shareholders where a company with a controlling shareholder seeks to cancel its listing or remove minority shareholders’ rights.
* Requiring greater transparency for listed companies to ensure shareholders have the information they need to exercise their voting rights.
News sponsored by: