On 17 May 2005, the Copenhagen Stock Exchange Committee on Corporate Governance published its report in which the Committee proposed a set of revised recommendations suitable for application according to the 'comply-or-explain' principle so meeting the request of the supervisory board of the Copenhagen Stock Exchange.
The Committee invited stakeholders to comment on the report and the proposal for revised Recommendations. The Committee has received a line of consultation replies and has revised the Recommendations on the basis hereof.
The consultation replies generally concentrate on the question of how the 'comply-or-explain' principle will be embodied in the Recommendations and how the company shall in effect address the Recommendations in their annual reports. In this connection, some replies also commented on the very structure of the collective set of Recommendations. Furthermore, some of the consultation replies touch on the..recommendation that the remuneration to the members of the management be disclosed individually. Finally, a number of consultation replies refer to the question of the independency of the supervisory board members.
In a letter to the supervisory board of the Copenhagen Stock Exchange, the Committee has commented on the most important items of the consultation replies and the adjustments of the Recommendations made on the basis hereof. The letter from the Committee to the Exchange's supervisory board, which is attached to this press release, and the Committee's proposal for revised recommendations are available at www.corporategovernance.dk and www.omxgroup.com/copenhagenstockexchange.
Chairman of the Committee Lars Nørby Johansen said: "We appreciate the interest that corporate governance in Denmark still receives and indeed the number of consultation replies returned to us. In particular, we have noted a general satisfaction with the delicate balance that the Committee has found with regard to special Danish aspects in relation to implementing the two EU recommendations into the Danish corporate governance code. We have endeavoured to make the Recommendations achieve widespread acceptance among the listed companies."
The Committee now hands over the result of its work to the supervisory board of the Copenhagen Stock Exchange, which will then consider the implementation of the Recommendations into the rules that apply to listed companies, including the implementation of the 'comply-or-explain' principle.
Lars Nørby Johansen commented: "Once again, we want to emphasise that the contents of the Recommendations compared with the 'comply-or-explain' principle imply that the most important thing is to establish transparency in the companies governance structure. It is equally acceptable to explain why a Recommendation is not followed than it is to follow it. It is therefore not a value or a goal in itself that the Recommendations are followed by the individual company. The company itself must assess to what extent it follows the Recommendations and whether it is appropriate or desirable to do so."
President and CEO Hans-Ole Jochumsen said: "We are pleased about the great efforts that the Committee has made to review the Recommendations for Corporate Governance to make them suitable under the 'comply-or-explain' principle. I expect that the supervisory board of the Copenhagen Stock Exchange will process the draft of the new recommendations in the coming months. As part of this process the supervisory board will discuss the implementation with the Exchange's Advisory Committee."
The report that was published in May 2005 and the consultation replies are available in their entirety at www.corporategovernance.dk and www.omxgroup.com/copenhagenstockexchange.
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