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Harmonization Process for Effective Corporate Governance in the European Union: From a Historical Perspective to Future Prospects

Harmonization Process for Effective Corporate Governance in the European Union: From a Historical... In 2011, the European Commission launched a public consultation on ‘the European Corporate Governance framework’, reflecting the EU's increasing concern about corporate governance issues, and the changes and reforms needed in the aftermath of the financial crisis. The question raised is twofold: first, should new objectives be established, and secondly, which of the various regulatory mechanisms, the traditional unification/coordination tools or the more recent comply‐or‐explain rule, would best fulfill these objectives? The article discusses how the financial crisis has made the harmonization of corporate governance more imperative, why the objectives of corporate governance rules must be enlarged to preserve the interests of companies as a whole, and which mechanism would best achieve these changes. More specifically, it tackles the comply‐or‐explain rule already widespread in Europe, discussing its major advantages and flaws, as well as the efficiency of its control by national and European market authorities. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Law and Society Wiley

Harmonization Process for Effective Corporate Governance in the European Union: From a Historical Perspective to Future Prospects

Journal of Law and Society , Volume 41 (1) – Mar 1, 2014

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References (15)

Publisher
Wiley
Copyright
© 2014 Cardiff University Law School
ISSN
0263-323X
eISSN
1467-6478
DOI
10.1111/j.1467-6478.2014.00658.x
Publisher site
See Article on Publisher Site

Abstract

In 2011, the European Commission launched a public consultation on ‘the European Corporate Governance framework’, reflecting the EU's increasing concern about corporate governance issues, and the changes and reforms needed in the aftermath of the financial crisis. The question raised is twofold: first, should new objectives be established, and secondly, which of the various regulatory mechanisms, the traditional unification/coordination tools or the more recent comply‐or‐explain rule, would best fulfill these objectives? The article discusses how the financial crisis has made the harmonization of corporate governance more imperative, why the objectives of corporate governance rules must be enlarged to preserve the interests of companies as a whole, and which mechanism would best achieve these changes. More specifically, it tackles the comply‐or‐explain rule already widespread in Europe, discussing its major advantages and flaws, as well as the efficiency of its control by national and European market authorities.

Journal

Journal of Law and SocietyWiley

Published: Mar 1, 2014

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