Amendment To The Shareholder Rights Directive

On 14 March 2017 the European Parliament adopted the text of a proposed directive to amend the Shareholder Rights Directive (2007/36/EC). This was adopted by the Council of the European Union (with only some very minor amendments) on 3 April 2017.

The key elements of the amending Directive are that:

• Companies will have greater disclosure obligations with respect to their remuneration policy, and shareholders will have an advisory vote on the remuneration policy.
• Shareholders will have increased voting power over related-party transactions which represent more than 5% of a company's assets or which could have significant impact on profits or turnover. Related-party transactions which represent more than 1% of a company's assets must also be publically announced together with the publication of an independent third-party report.