OECD Corporate Governance Factbook
The OECD Corporate Governance Factbook issued every two years, provides information on trends and evolution in the corporate governance of listed companies across jurisdictions worldwide.
The Factbook complements the?G20/OECD Principles of Corporate Governance ?as a tool for policymakers to assess and improve their corporate governance frameworks.
The revised Principles include a new chapter on “Sustainability and resilience” which provides recommendations to support companies in managing risks and opportunities of the climate transition and other sustainability challenges.?
The goals of the 2023 revision of the Principles were to:
As stated in the 9-10 September 2023 Summit Declaration of the G20 Leaders, who endorsed the revised Principles "with the aim to strengthen policy and regulatory frameworks for corporate governance that support sustainability and access to finance from capital markets, which in turn can contribute to the resilience of the broader economy”.
Sustainability
The assumption is that climate change is a financially material risk?for listed companies representing two-thirds of global market capitalization.
Disclosure of sustainability-related information is increasing, but the number of listed companies disclosing this information globally remains low, ranging from 17% in China to 34% in Europe.
To such end, in half of the jurisdictions surveyed, boards are explicitly required or recommended to approve policies on sustainability-related matters. Only a few jurisdictions, mostly within the EU, have so far adopted regulatory frameworks on ESG rating.
Virtual remote meetings
The increasing use of digital technologies appears likely to encourage effective participation by shareholders and ensure their rights are protected.?
Post COVID-19 many jurisdictions have adopted new provisions for virtual (where all shareholders attend the meeting virtually) and (where some shareholders attend the meeting physically and others virtually) hybrid shareholder meetings.?
As of the end of 2022, virtual meetings are allowed and regulated in approximately 75% of the jurisdictions surveyed, with hybrid meetings in an even higher number, with more than 80% of the jurisdictions having a provision allowing it.
领英推荐
Gender balance
The percentage of women on corporate boards is growing but is still below 30% on average.
Since 2019, more jurisdictions have adopted measures to encourage the participation of women on corporate boards and in senior management.
However, the progress also achieved in jurisdictions with no quota or target shows the importance of alternative and complementary measures such as shareholder initiatives in support of greater diversity, and of creating a more enabling environment for the advancement of women on boards.
Market Landscape?
Listing is nowadays a key to accessing investments and supporting economic growth. At the end of 2022, there were almost 44,000 listed companies worldwide.?
The United States remains the largest market by market capitalization, while Asia has the highest number of listed companies.
Ownership concentration
The degree of ownership concentration in an individual company is an important factor shaping corporate governance frameworks, not only impacting the relationship between owners and managers but also the relationship between controlling and non-controlling owners.?
The 2023 Factbook shows a significant increase in jurisdictions allowing companies to issue multiple voting shares, departing from the “one share one vote” proportionality principle.
With the sole exception of 8 jurisdictions, related-party transactions now require both periodic and immediate disclosure. Board approval is often subject to the abstention of related board members and requires the involvement of the audit committee or independent directors and the Shareholders.
Moreover, to address company group complexity, more than 80% of jurisdictions require public disclosure of a range of elements related to company group structures, their ownership, and intra-group activities.
Download the full OECD Corporate Governance Factbook: Link
Contact us if you want to find out more.
The information provided in this article is for general informational purposes only and does not, and is not intended to, constitute legal advice.