9 FEB, 2021
By Constanza Ramos
The European Fund and Asset Management Association (EFAMA) has published today its response to the European Commission’s consultation document proposal for an initiative on sustainable corporate governance.
EFAMA supports the European Commission’s initiative to ensure environmental and social interests are fully embedded into business strategies. The association believes this initiative can contribute to improving the reliability of information disclosed by companies under the revised Non-Financial Reporting Directive (NFRD) and, in turn, positively affect the quality of disclosures made to end-investors. However, the consultation paper portrays a fundamental opposition between the interests of shareholders and those of stakeholders, and depicts shareholders as exclusively interested in short-term financial returns. European Supervisory Authorities, as well as EFAMA, have not found sufficient evidence of investor-driven short-termism in European capital markets. Any successful legislative measure will have to counter these assumptions and be based on a solid, evidence-based approach.
In its response, EFAMA provides evidence and recommendations it believes will contribute to achieving the European Commission’s objective. Key priorities, as identified by EFAMA, are as follows: