Alterations to the EU legislation will encourage transparency in stock listed companies in all member countries. Although the change is gradual, companies should begin preparations now.
Text Pete Santos
BORENIUS FINLAND - Andreas Doepel, partner at Borenius, who advises on mergers and acquisitions as well as on contract law with a particular emphasis on company law, responds concerning the current state of transparency in both Finnish and EU companies.
"In general, companies listed in the Helsinki Stock Exchange are transparent but there is diversity. Some companies excel in this area and while others have a ways to go until they reach an optimum level of transparency. Larger companies have greater resources and spend more time and money on quality reporting but even among them there is variety."
Time to adjust
Doepel believes that the new laws will require companies to put more focus on reporting and documentation. The objective of the new regulation is to increase transparency and performance on environmental and social matters. The laws will take effect over the next few years into 2017. Companies that are lagging behind will have time to make the necessary adjustments to meet the new standards.
"The new transparency rules on disclosure of non-financial and diversity information will increase the reporting bureaucracy for many companies, even though the European Commission professes in its statement that the new administrative burden imposed by the Directive is kept to a minimum. There is a concern that the new detailed rules would require companies to disclose sensitive information on their strategy and business models", Doepel says.
Partner Andreas Doepel heads the corporate law practice and Nordic Desk of Attorneys at law Borenius.