Observance of the Corporate Governance Code gives assurance to minor shareholders and increases reliability of the company
Press release from the EFSA and Tallinn Stock Exchange
The Tallinn Stock Exchange and EFSA presented the first draft of the Estonian Corporate Governance for comments.
"The Code aims to provide for minor shareholders, pension fund and other institutional investors a clear measure to assess whether management of a company follows their interests," Chairman of the Tallinn Stock Exchange Board Gert Tiivas said.
A common priority on the Estonian securities market is continuous enhancement of business management. The Code currently in preparation would be a guide for those who want to give investors assurance about adherence to governance rules. Comprehensible and transparent administration can increase the company's value for investors. The roundtable members who initiated preparation of the Good Governance Code are of the position that if implemented, it provides the company with additional value, not additional burden. The publicly held companies observing the Corporate Governance Code would set a good example and motivate other companies as well to follow these principles.
"The Corporate Governance Code is the Ten Commandments for issuers who desire to be transparent and ethical in their management method," Member of the EFSA Management Board Kilvar Kessler added.
The Corporate Governance Code is based on the following values:
- Shareholders are treated equally in equal circumstances;
- Shareholders are active and responsible in the governance of the issuer;
- Shareholders and administration of the issuer consider each other?s rights while exercising their rights, by taking into account the welfare of the issuer;
- Governing bodies of the issuer have clear responsibilities and roles;
- Corporate governance is fair, transparent and predictable.
The Corporate Governance Code will be an integral part of the rules and regulations of the Tallinn Stock Exchange and supplementary to legislation. The Code will be voluntary for the issuer, but when not followed, the company has to explain the reasons thereof in its operating report according to the so-called 'comply or explain' rule.
The EFSA and Tallinn Stock Exchange are expecting comments on the necessity, compliance control and draft of the Corporate Governance Code at the latest on April 15, 2004 at the EFSA mailing address or heatava at omxgroup dot com. The draft of the Corporate Governance Code is available at www.omxgroup/tallinn/heatava .
Drafting of the Corporate Governance Code initiated in the partnership of the EFSA and Tallinn Stock Exchange aims to provide a code that would form the basis for business management primarily in the interest of the company and be instrumental in solving conflicts and avoiding excessive pressure from certain interest groups on business management. Implementation of the Code will increase the transparency and openness of business activities and allow investors to better compare different companies.
The EFSA is an agency with autonomous competency and an objective to enhance stability, reliability and transparency of the Estonian financial sector. One goal of financial supervision is to protect the interests of customers and investors in preserving their assets. The EFSA website is located at www.fi.ee.
The Tallinn Stock Exchange is a regulated securities aftermarket in Estonia. The Tallinn Stock Exchange and Estonian Central Register of Securities are members of the OMX Group. OMX is comprised of two divisions: OMX Technology offers solutions for trading technology and OMX Exchanges operates stock exchanges in Copenhagen, Stockholm, Helsinki, Tallinn, Vilnius and Riga, allowing access to 80 per cent of the Nordic and Baltic securities market.
For additional information, please contact:
Gert Tiivas, Tallinn Stock Exchange
Tel: + 372 640 8802, heatava at omxgroup dot com
Kilvar Kessler, Finantsinspektsioon
Tel:+ 372 668 0546, livia dot kulm at fi dot ee
Tallinn Stock Exchange/Estonian Central Register of SecuritiesTel: 640 8862, 526 7070
E-mail: tex dot vertmann at omxgroup dot com