In his political guidelines for the new EU Commission, President Juncker pledged to create a European Capital Markets Union (CMU) to increase non-bank financing of the European economy and further integrate capital markets. In this context, the EU Commission launched a public consultation in February 2015.
Frank Bold submitted a response to the consultation and prepared an accompanying paper outlining the recommendations sent to the EU Commission on the guiding principles of a proper functioning CMU.
Frank Bold has stated that financing through capital markets is not appropriate for most private companies, especially SMEs, which will continue to be primarily financed through relationship-based bank lending. Private companies are often rightly concerned about listing due to the risk of pressure from capital markets. Therefore, Frank Bold recommends clarifications to the role of investors in corporate governance and the protection of corporate purpose.
More broadly, future policy should integrate sustainability and corporate responsibility into its central priorities. We highlight necessary changes to insolvency, company and tax laws for the development of a strong, stable and equitable pan-European financial market.
Our response includes the following recommendations:
The next phase will be this summer when the EU's financial services commissioner, Jonathan Hill, will adopt an Action Plan establishing the roadmap to put in place the building blocks for CMU by 2019.
If you are interested to know more about Frank Bold's recommendations to promote sustainable financing of European companies you can read the accompanying paper to the CMU public consultation Written by Paige Morrow, head of Frank Bold Brussels Operations and responsible for the Purpose of the Corporation Project.
Bucharest: The European Bank for Reconstruction and Development (EBRD) confirmed this week [1] that it has suspended plans to finance the refurbishment of the Turceni coal power plant in Romania [2]. The project is currently subject to a number of legal challenges on environmental grounds and Romanian authorities are investigating allegations of corruption at the plant.
The respect of human rights is the most fundamental value that we have as a society. Nevertheless, economic globalisation has lead to the massive exploitation of human rights in developing countries for the benefit of multinational enterprises (MNEs). The outsourcing and offshoring of production and services have had huge environmental and social costs.
The European Parliament approved last weekthe proposed college of Commissioners. Věra Jourová successfully faced the public grilling and will become the Commissioner for Justice, Consumers and Gender Equality. Due to the shift of competencies within the Commission, Ms. Jourová will have an opportunity to influence the governance and rules of the game for multinational corporations.
