The AMF’s working group on general meetings, which was launched in May 2011 and is chaired by Boardmember Olivier Poupart-Lafarge, has recently issued its conclusions. Its report is subject to public consultation until 7 March 2012. The group, which consists of experts from a variety of backgrounds, focused on the following subjects: dialogue between shareholders and issuers at general meetings, the functioning of general meetings and voting on regulated agreements.
In general terms, the report delivers a positive overall verdict as to the functioning of general meetings in France and proposes avenues for improvement in specific areas. On the basis of this observation, the working group has issued a series of proposals aimed directly at the relevant parties, primarily listed companies. It has also suggested legislative and regulatory changes. Its proposals are based around four themes:
Dialogue between shareholders and issuers: the group reiterates the need for ongoing dialogue both before and after general meetings. It notes that the opportunity for shareholders to express their concerns is an important component of dialogue. Such expressions of concern may take the form of proposed resolutions, agenda items, or written or oral questions. The group also emphasises the need to make more effort to explain the content and purpose of proposed resolutions made by the board of directors at general meetings.
Voting: the group proposes firstly that shareholders be given a third option by way of the official recognition in French law of “abstention” as distinct from voting “against”, and secondly that the mechanism by which non- resident shareholders submit their votes be improved. This mechanism is relatively complex, more because of the channels used than because of the applicable law. The group also proposes various concrete measures linked to the possibility of electronic voting, which would be of benefit to all shareholders, whether resident or non-resident.
General meeting’s executive committee: the group’s discussions have focused on clarifying and formalising certain currently observed practices, particularly in relation to executive committee’s powers. The group is keen that the role played by the centralising institution in determining the completeness of the attendance register be formally recognised. Finally, it has proposed measures to prevent conflicts of interest with which members of the general meeting’s executive committee might be faced.
Voting on regulated agreements: the group considers that the roles of the various players involved in the process of approving and ratifying such agreements need to be reiterated and occasionally reinforced. To this end, boards of directors are encouraged to provide reasons for their decisions to approve regulated agreements. It is also proposed that the scope of such agreements be more clearly defined and that agreements entered into with wholly-owned subsidiaries be excluded from this scope. Conversely, agreements entered into between a senior executive or director and a subsidiary should be notified to the parent company’s shareholders and should, in certain cases arising from de facto circumstances, be subject to the procedure governing regulated agreements within the parent company.
Following the public consultation, the group’s proposals – which do not entail any amendments to existing legislation or regulations – should normally enter into force at the AMF’s recommendation and be applicable to general meetings held with effect from 1 January 2013 at the latest.
The public consultation will run until 7 March 2012; responses should be sent to contactcom@amf-france.org
LIST OF WORKING GROUP MEMBERS
Chairman
- Olivier Poupart-Lafarge, member of the AMF Board
Members
- Anne-France Arnoux-Saugnac, Deputy General Counsel, Risks and Compliance, Bureau Veritas
- François Basset-Chercot, Board Secretary, L’Oréal
- Francine Bobet, audit partner, Ernst&Young; Chair of the CNCC’s Commission on Legal Studies
- Odile de Brosses, Head of Legal department, AFEP
- Alain Couret, Professor at the law school of the Sorbonne (Université Paris 1); partner, CMS-BFL
- Philippe d’Hoir, partner, FIDAL
- Philippe Haudeville, Secretary General, AF2I
- Michael Herskovich, Head of Corporate Governance, BNP Paribas Asset Management
- Pierre Dinon, Head of Corporate Governance, Allianz Global Investors France
- Michel Léger, Chairman, BDOViviane Neiter, Honorary Chairperson, APAI
- Colette Neuville, Chairperson, ADAM
- Pascal Pommier, Head of Corporates and Issuers, BNP Paribas Securities Services
- Fabrice Rémon, Chief Executive Officer, Deminor France
- Jean-Paul Valuet, Secretary General, ANSA
- Jérôme Vitulo, Assistant General Counsel, Lafarge
- Caroline Weber, General Director, Middlenext and Frédérique Desroches, Middlenext
- Aude Ab-Der-Halden, Assistant Director for Business Law in the Directorate for Civil Affairs and the Seal, Ministry of Justice
- Ronan Guerlot, Head of the Business Law section, Ministry of Justice
- Adrienne Isaac, Business Law section, Ministry of Justice
- Hubert Gasztowtt, Legal Advisor to the Director General of the Treasury
- Yasmina Moubachir, Deputy Supervisor, Financial Stability, Accounting and Corporate Governance, Directorate General of the Treasury
AMF representatives
- Benoît de Juvigny – Managing Director
- Edouard Vieillefond – Managing Director – Regulatory Policy and International Affairs Directorate
- Olivier Douvreleur – Director, Legal Affairs
- Patrick Parent – Director, Corporate Accounting
