The CNMV will turn a blind eye to the law on salaries of directors. The supervisor will allow the boards this year will not vote on the remuneration of advice or individual salaries despite the new regulations.
Transparency will have to wait. The National Securities Market Commission (CNMV) has decided to give a grace period and listed companies the savings before requiring them to submit to the advisory vote of the directors remuneration. The supervisor and it has been transferred to the companies that have been consulted, despite the new regulations requiring that extra transparency and scrutiny by shareholders is fully in force, according to legal sources.
executive bonuses and salaries of the directors have received international controversy over the financial and economic crisis in recent years. To curb abuse, practices that encourage excessive risk and possible scandals have taken various measures, especially in the financial sector. Such
measures, the English government opted for a greater transparency and scrutiny of remuneration to certain provisions of the Law of Sustainable Economy (LES). It entered into force on March 6 and requires that "the annual report on the remuneration of directors, the remuneration policy of the company approved by the Council for the current year, as provided for future years, the overall summary of how the remuneration policy applied during the year and details of individual remuneration payable by each of the directors, will be distributed and voted upon in an advisory capacity and as a separate item the annual general meeting of shareholders. "
legal sources consulted among law firms in the first row agree that the rule is in effect and should be applied in the shareholders' meetings have been held (or at least that have called) from the entry into force of the provision.
The CNMV, however, has responded to the companies that have asked about the issue that will still require compliance with the rule. The supervisor has taken into account Regular meetings now being held under the year 2010 and that companies had already held their meetings before the entry into force of the LES. Sources of supervisor further notes that the content and structure of the remuneration report which provides the LES is pending regulatory development has not yet been produced. The Ministry of Economy, which is attached the CNMV, declined comment. In any case, the supervisor says that companies who want to vote on salaries and "can do so voluntarily."
The main novelty of the rule was, however, make these practices mandatory. Just two of the Unified Code of Good Governance that have a lower voluntary monitoring refer to transparency of remuneration. Only one in five companies submitted for a vote board a report on the remuneration policy for directors. And only 28.2% of listed companies in its report details the individual remuneration of directors, according to the CNMV.
experts understand that the entry into force of the LES as part of shareholders' meetings for 2010 already has generated anomalies. But even critics of poor legislative practice, no doubt that the Act applies. That is, the lawyers believe it would have been logical to include a transitional provision, first, make that the rule will apply to all companies in the same period and, secondly, had time to develop the rules on the remuneration report. But lawyers note that there is a transitional provision and therefore the standard should be met. No need for any development, the new provision requires the dissemination and advisory vote undergo individual remuneration of directors, the remuneration policy for the current year and planned for future years, among other issues. And emphasize that the law is silent on who has to wait until there is a standard reporting compensation for that requirement is immediate.
In fact, some of these law firms have advised companies to advise follow the law and to bring these issues to a vote but The CNMV has not yet required. This challenge or seek to avoid shareholder lawsuits to interpret that is not complying with the law. That is why you are significantly increasing the number of companies which has been in the agenda of the consultative vote of the council salaries. Other companies, however, have preferred to wait until it is the CNMV requiring compliance. M Case Studies
