US / EUROPE - The International Corporate Governance Network (ICGN) has thrown its weight behind the European Commission's (EC) recommendations for regulating corporate takeovers and mergers within the European Union (EU).
ICGN chairman Peter Clapman has written to Frederik Bolkestein, the EU Commissioner for Internal Market Taxation and Customs Union, calling the proposals a very positive development.
Clapman is especially pleased that the guidelines include two specific measures, the first being that only shareholders - not regulators or political bodies - should determine the success or failure of a takeover bid. The other measure would give all shares equal voting rights. Clapman believes that one share, one vote should apply to small and large shareholders alike, allowing each individual or institution to vote in proportion to their financial interest in the company.
But despite his enthusiasm for the EC's proposals, Clapman issued a note of caution, emphasising that differences among various EU member states on this issue helped derail a previous effort to create uniform takeover procedures.
He urged that any new regulation guidelines put in place should encourage not only uniform rules among EU member states, but should also incorporate the best practices currently found, rather than those which are questionable.
In addition to his duties as ICGN chairman, Clapman is senior vice president and chief counsel, corporate governance, at TIAA-CREF, the giant US pension fund.
The ICGN - which has 250 members, representing investment organisations and corporations from 20 nations, with US$12trn assets under management - looks to promote sound corporate governance principles and fair treatment of all equity shareholders.
By Geoffrey Ho
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