The second wave of changes to the Company law in order to harmonise it with the community norms
Author:
PhD. Student Annee-Marie GRECEA
JEL:
DOI:
Keywords:
Corporate Governance, reform, OECD principles, community Aquis, EC recommandations, administrator, auditor, general assembly, censor, financial statements
Abstract:
The legislative reform on corporate governance consist of two main parts. The first one is refered to the compliance of domestic legislation on corporate governance with the OECD priciples. The second one is refered to the compliance of domestic legislation on legal entities with the requirements of the community Aquis.\r\n\r\nThe draft of the law covers the OECD priciples on corporate governance, the means of development of legislative framework toward European Community standards and the best practice in the European Community member states.\r\n\r\nThe milestones of this reform are, except for the OECD priciples, the European Community norms, particulary the European Community recommandations, the present legislative framework on legal entities and the reforms that have been recently implemented the the West- and Esteuropean member states. \r\n\r\nThe amendment of Companies Law has been welcomed within the academic environment. It has imposed to around 11.500 Romanian joint-stock companies to implement the principles of corporate governance, has regulated more coherently the organization and decision process of General Assembly of Shareholders, the management of joint-stock companies, the rights of minority shareholders, the potential abusive exercise of voting rights by shareholders, the procedure of merger and spin-off of companies, the dummy companies.\r\n\r\nThus, a certain part of the business environment has hostilely reacted to these amendments. Firstly, it has been criticized the interdiction of cumulative exercise of both administrator and manager functions based on a labor agreement. Secondly, it has also been criticized the induction of legislative clause that bound the managers of joint-stock companies to insure against the risk of professional liability. Following the debates on these issues, these critics outlined above have proved not to be consistent. This is because the Romanian joint-stock companies, that are the single beneficiaries of the corporate governance provisions, are highly required to implement such provisions. The positive attitude toward these provisions will enable the Romanian joint-stock companies to compete with companies from EU or other developed countries that have already extensively implemented them. The control procedures carried out by managers and the segregation of duties within joint-stock companies represent the main targets of corporate governance principles.