The EU and the US are rethinking their non-financial disclosure requirements and announcing a series of new ESG-related interventions

As announced under the bold European Green Deal, the European Commission has launched a public consultation on the review of the Non-Financial Reporting Directive (NFRD). The NFRD sets out the rules for disclosing non-financial information by large companies as required by the Directive 2014/95/EU. The survey will remain open to…

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Proxy adviser’s downgrades cost companies 1% of market value

Evidence demonstrates that investors’ behaviours change when the largest proxy advisory firm downgrades public companies’ rating on governance ground. Professor Paul M. Guest and PhD student Marco Nerino of King’s Business School at King’s College London empirically demonstrate that Institutional Shareholder Services‘ (ISS) announcement of corporate governance ratings downgrades has…

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Investors rise up against SEC anti-proxy adviser proposals

In November 2019, the Securities and Exchange Commission (SEC) voted a controversial proposal for more stringent scrutiny of proxy advisers, companies which support investors managing their votes at corporate meetings. The US financial regulator required proxy adviser to let listed companies’ management review  proxy advisers’ recommendation before it goes to investors. Moreover, it set…

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Private equity industry reshaping American capital markets

https://www.euromoney.com/article/b1dx148qjztwp3/why-private-capital-will-dominate-markets-for-the-decades-to-comeScepticism over capital markets is on the rise.  It is leading more and more investors to turn to the powerful and growing private equity industry. As a result, companies tend to stay private for longer swelling private equity market five times in the last two decades. Increasing lax corporate governance…

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PwC considers handing to external body oversight of auditors’ pay

https://www.wsj.com/articles/pwc-considers-changes-to-u-k-auditor-pay-to-avoid-conflicts-of-interest-11569609468Karthik Ramanna, a professor of business and public policy at the University of Oxford’s Blavatnik School of Government, in a report commissioned by PwC in June 2019, called for audit firms to resort to independent, external remuneration committees to advise on audit partners’ pay. He also also suggested for audit firms’…

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Thomas Cook auditors under observation

Britain’s accountancy regulator Financial Reporting Council (FRC) will start soon to investigate the collapse of Thomas Cook. The investigation would likely focus on two Big Four audit firms, EY and PwC, in order to clarify their position and understand whether they have some responsibilities. EY and PwC declined any comment.   For further information,…

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