2004年-世界发展银行全球_Corporate_Governance_Country_Assessment___Slovenia_21页_764kb

Corporate Governance Country Assessment of Slovenia (ROSC Report, May 2004)

I. Executive Summary

This report evaluates Slovenia's corporate governance policy framework and enforcement practices against the OECD Principles of Corporate Governance. Slovenia has aligned its legislation with EU Directives, resulting in a corporate governance framework comparable to many EU member states. The report highlights both strengths and weaknesses in the current system and offers policy recommendations to further improve governance standards.

Key issues include the ongoing consolidation of ownership in both small and large companies, which may lead to reduced minority shareholder influence. The report emphasizes the need for stronger protections for minority shareholders, improved disclosure practices, and enhanced oversight by regulatory bodies.

Policy recommendations focus on the following areas:

• Formal approval and disclosure of related party transactions
• Increasing minority representation on boards
• Disclosure of shareholder agreements
• Review of public company disclosures by the Securities Market Agency (SMA)
• Establishment of audit committees for listed companies
• Continued support for supervisory board training
• Institutional investors developing policies that require board members to act in the best interest of all stakeholders

II. Capital Markets and Institutional Framework

Overview

Slovenia's corporate governance development is driven by its EU accession in May 2004. The country's corporate ownership structure is a legacy of the mid-1990s privatization program. Large and medium-sized companies are often controlled by insiders and institutional investors, including the State-owned pension fund KAD and the restitution fund SOD.

• Company Forms: Limited liability companies ("d.o.o.") are the most common, while joint stock companies ("d.d.") are required for public listings.
• Listing: Only joint stock companies can be listed on the Ljubljana Stock Exchange (LJSE). As of October 31, 2003, 32 companies were listed on the Official Market and 98 on the Free Market.
• Market Capitalization: Total market capitalization (excluding closed-end funds) was USD 5.9 billion, representing 22.9% of GDP.
• Shareholders: There were about 955,000 shareholders in June 2003, with a declining trend due to consolidation.
• Foreign Ownership: Foreign investment accounted for 5.9% of market capitalization, relatively low compared to other transition and emerging market countries.

Regulatory Bodies

• Securities Market Agency (SMA): The capital market regulator, responsible for licensing, supervision, and enforcement of disclosure and insider trading laws.
• KDD (Central Securities Clearing Corporation): Maintains the central share register and handles share transfers and settlements.
• LJSE: The main stock exchange, with listing rules requiring compliance with a Corporate Governance Code on a "comply or explain" basis.

Key Laws

• Securities Market Act (1999): Governs disclosure and insider trading.
• Mergers and Acquisitions Act (1997): Regulates takeover rules and ownership disclosure.
• Investment Funds Act (2002): Governs investment funds and their activities.

III. Review of Corporate Governance Principles

Section I: The Rights of Shareholders

Principle IA: Shareholder Rights

• Assessment: Largely observed
• Description: Shareholders have basic rights to information, voting, and profit sharing, though some gaps exist in minority representation and dividend clarity.
• Recommendations: Introduce cumulative voting or allow shareholder thresholds to appoint board members. Require general meetings to set ex-dividend dates.

Principle IB: Participation in Fundamental Corporate Changes

• Assessment: Largely observed
• Description: Shareholders can participate in major decisions, with some requiring supermajority approval.
• Recommendations: Define "large transactions" and require supermajority approval for such transactions.

Principle IC: Effective Participation in Shareholder Meetings

• Assessment: Largely observed
• Description: Shareholders can attend and vote, with some mechanisms for proxy voting and agenda items.
• Recommendations: Review meeting practices to ensure adequacy for investment funds, possibly introducing quorum requirements and mandatory proxy voting.

Principle ID: Disclosure of Disproportionate Control

• Assessment: Largely observed
• Description: Transparent ownership structures due to public access to the central share register.
• Recommendations: Disclose shareholder agreements as material events in annual reports.

Principle IE: Efficient and Transparent Market for Corporate Control

• Assessment: Largely observed
• Description: Active takeover market with a defined 25% threshold for tender offers.
• Recommendations: Update Mergers and Acquisitions Act to address enforcement weaknesses. Consider expanding coverage to include "gray market" companies.

Principle IF: Consideration of Costs and Benefits of Voting

• Assessment: Largely observed
• Description: Institutional investors play a significant role in shareholder meetings.
• Recommendations: Develop corporate governance standards for State-owned funds. Consider investor responsibility in governance codes.

Section II: The Equitable Treatment of Shareholders

Principle IIA: Equitable Treatment of Shareholders

• Assessment: Largely observed
• Description: Equitable treatment is generally ensured, with mechanisms for redress.
• Recommendations: Enhance SMA's enforcement capacity, including direct fine authority. Review periodic disclosure practices.

Principle IIB: Prohibition of Insider Trading and Self-Dealing

• Assessment: Largely observed
• Description: Insider trading is prohibited, with legal definitions and reporting requirements.
• Recommendations: Strengthen SMA's oversight of related party transactions. Consider "black-out" periods around information releases.

Principle IIC: Disclosure of Material Interests

• Assessment: Largely observed
• Description: Board members and managers are required to disclose material interests.
• Recommendations: Ensure consistent and comprehensive disclosure of interests, particularly in related party transactions.

IV. Summary of Policy Recommendations

• Enhance SMA Authority: Increase SMA's capacity for enforcement, including direct fine imposition and review of periodic disclosures.
• Improve Minority Shareholder Protection: Encourage cumulative voting and increase minority representation on boards.
• Strengthen Disclosure Requirements: Mandate disclosure of shareholder agreements and related party transactions.
• Update Takeover Laws: Review and possibly revise the 25% threshold for tender offers and ensure coverage of all relevant companies.
• Support Institutional Investors: Develop policies requiring board members to act in the company's best interest.
• Promote Transparency: Ensure continued transparency in ownership structures and corporate control mechanisms.

V. Annexes

• Annex A: Summary of Observance of OECD Principles of Corporate Governance
• Annex B: Summary of Policy Recommendations

This assessment is part of the World Bank-IMF joint ROSC program, and the report was cleared for publication by the Securities Market Agency on May 12, 2004. It was drafted by Alexander Berg, with input from Sue Rutledge.