Annual Corporate Governance Conference, 2013, August 21, Canadian Society of Corporate Secretaries

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Session C August 21 , boards secretaries' duties and role
15th Annual Corporate Goverbrnance Conference / Canadian Society of Corporate Secretaries Halifax, NS, Canada

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Annual Corporate Governance Conference, 2013, August 21, Canadian Society of Corporate Secretaries

  1. 1. Board Secretaries’s role and duties in Europe Corporate governance conference, Halifax,Wednesday, August 21, 2013
  2. 2. ecoDA BENCHMARK, 2013 Which is ecoDA?  The European Confederation of Directors' Associations,considered as « the EuropeanVoice of Directors What about this benchmark ?  It’s time to specify the role of Corporate Secretaries  Lack of societies of corporate secretaries in Europe  Lack of corporate secretaries in many companies (big, small and medium) 2
  3. 3. Four questions  Is the function legally recognised in your country?  Do Board Secretaries have clear functions and duties?  Do they have a specific place in the organisation?  Have your Institute carried out any actions to promote the role of Board Secretaries? (working groups, networks, surveys…) 3
  4. 4. Amazing heterogeneous results The board secretary function is not legally recognised, (except in Spain and in the U.K)  German case: a two tier system - a “Corporate Secretary” (legally not required) supports the management board - But no comparable institution for the Supervisory board. 4
  5. 5. In the UK For every public company, a legal requirement to have a company secretary.  For a private company, not a legal requirement but common at larger private companies.  In very small companies, company secretarial duties may be outsourced to an external provider 5
  6. 6. What SPAIN ?  According to the Capital Companies Act , a few articles to the Secretary of the Board, describing its duties and responsibilities within the Board of Directors of the Companies 6
  7. 7. No clear functions & duties  As Company Secretaries are not legally recognised, there are no clear functions and duties.  No real willingness to bring about changes until shortly before the launching of this benchmark.  Why? Too many small companies ? No cooperation between countries ? 7
  8. 8. Luxembourg, an "engine" in the quest for solutions and launch of initiatives + Presence of ILA Company Secretary Committee, « the CS supports those who support the Board »  Commonly understood to involve (in particular organising Agendas, board packs and minutes of Board meetings).  employees, lawyers, directors, compliance officers, or other persons by title  the full Board Support role may also be split between different persons covering different aspects of it. 8
  9. 9. Unrewarding roles  No clear specifications of their duties, apart from a common understanding of their role (organising Agendas, board packs and minutes of Board meeting  BUT in this time of change, need to continue playing their role of well-placed observers and judicious advisers. 9
  10. 10. Spain: a sort of public notary within the Board  As such, the only one to draft the minutes of all meetings being held by the Board of Directors and/or all the Commissions created within it.  also, in charge of officially certify all resolutions adopted by all the administrative bodies of the Company including the General Shareholders' Meeting  specially the resolutions officially recorded within the Commercial Registry.  all the official books and records of the Company are under the official custody of the Secretary of the Board. 10
  11. 11. UK: legal but large in case of need  Some of the role and duties of the company secretary defined in the UK Corporate Governance Code.  But a large range of duties may be undertaken in the role .  In some companies, role quite specialised, and focused on supporting the chairman and the board and fulfilling legal/compliance requirements.  In other companies (e.g. smaller companies), a more wide-ranging role akin to chief operating officer. 11
  12. 12. General, no specific positions in the organisation  In Denmark, company secretaries defined as a specific position, or as a part of their responsibility  In Finland, no specific place in the organisation and function therefore not established.  in Germany ever company has its own model to support the supervisory board: - in most companies, the Corporate Secretary of the Management Board responsible for the organisation of the Supervisory Board meetings and  prepare the documents for the Supervisory Board Members. 12
  13. 13. Awareness in Luxembourg,a tax haven  Rection to the lack of definition and lack of clarity about their role  In addition to the overview on ILA's website http://www.ila.lu/Z_Partie_Corporate_Secretaries/eng_latest _updates.php),  a recent document drafted by ILA's Company Secretary Committee giving a broad outline of how they see their duties as "high level principles" to ensure it could be adapted to most situations. 13
  14. 14. What about France?  Few secretaries  The main interface, key link between managers and/or owners and board members  The guarantor of the success  The principal guarantee of the relevance and proper functioning of the Board over time.  The invisible transmitter/receiver of the Board 14
  15. 15. What about the Belgian Institute of Directors, GUBERNA  An inquiry some years ago in order to try to identify a common profile for the General Secretary  An informal Company Secretaries Platform created with the support of some local « General secretaries » and PWC.  A distinct group forGeneral Secretaries in their member basis as well as for research ends ( best board practices inquiry) as for other activities (speakers, legal advice/exchange of experience...) 15
  16. 16. The impact of CG codes  In Macedonia,  More and more direct discussions with clients and members. (Corporate Governance Reviews or Assessments) to explain the need of this function in companies  Plans to promote the function and to focus attention on corporate secretaries 16
  17. 17. Excerpts from the Corporate Governance Code of the Stock Exchange regarding corporate secretaries (legal counsels)  Principle 11:The board of directors or the supervisory board is assisted by an internal legal counsel.  11.2:The internal legal counsel assists the chairman of the management body or the supervisory board in the organization of the board of directors or supervisory board meetings (information, agenda, evaluation, training program, etc.)  ; 11.3:The Chief Executive Officer upon consent from the board of directors appoints and dismisses the internal legal counsel;The management board upon consent from the supervisory board appoints and dismisses the internal legal counsel;  11.4:The duties and responsibilities of the internal legal counsel are defined by the internal regulations for the management body or the supervisory board and are available on the website of the company; 17
  18. 18. Clubs and task forces engaged  In Norway, a company secretary forum twice a year to discuss their role and work processes (highly appreciated)  In France, a club of Companies Secretaries ,energized by the Secretary of the Board of L’Oréal and committed to sharing best practices with other members.  In the most countries, development of working groups (domino effect) to avoid hard law and foster best practices 18
  19. 19. Numerous projects conducted……  In Poland : - research publications and some articles on company secretaries (UK) or corporate secretaries (US & Canada) in quarterly reviews. - some seminars and workshops in order to promote the function, to inspire legislation to introduce some modern solutions to our company law.  In Slovenia, - a working group created to prepare a survey and recommendations on the role of a board secretary (they keep a track in their database and regularly communicate with them ) 19
  20. 20. But not formalized  In Spain: - Up to now, no special action from ICA in order to promote the role of Board Secretaries. - However, in the document dedicated to the duties of the members of the Board, a special chapter specifically referred to the role of the Board Secretaries.  In Sweden: - no actions or promotion focused on the roles of the boards’ secretaries but plan of a course aimed at the role of the board secretary - desire to liaise and collaborate with IFA and/or EcoDA (cross border or European initiatives 20
  21. 21. In the UK , a dynamic Institute The Institute of Chartered Secretaries andAdministrators (ICSA) and its important role : - he can go about rebuilding trust, - he considers he or she can play in facilitating a positive culture at board level. 21
  22. 22. Conclusion: the wake-up of European secretaries  Ensure a balance of power between the executives , the Board of Directors and shareholderds  Have a task in the evaluation of Board members  Have a role recognized by stakeholders (under the soft law)  Be a driving force in the quest for solutions and launch of initiatives. 22
  23. 23. Predictions : evolution of the role of CS ecoDA and its members , more than a Europe –wide think tank, a real desire to become a action tank, that spearheads proposals focusing on how to effectively transition to an active role. 23
  24. 24. 24 ManyThanks ! Viviane Neiter Board member neiter.consulting@wanadoo.fr +33 6 30 97 32 89 89

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