Corporate Governance refers to a set of principles on the basis of which companies are managed and controlled. According to the Corporate Governance Principles of the Organisation for Economic Cooperation and Development (OECD), corporate governance is a system of relations between the company's management, the Board of Directors (BoD), shareholders and other stakeholders. Corporate governance recommends the structure through which the company's objectives are approached and set, identifies the main risks it faces in its operation, determines the means to achieve corporate objectives, organises the risk management system and enables monitoring the management performance in the process of implementing all of the above.
In Greece, the Corporate Governance framework has been developed mainly through the adaptation of mandatory rules, such as Law 3016/2002. This law imposes the participation of non-executive and independent non-executive members on the Boards of Directors of Greek listed companies, the establishment and operation of internal audit units and the adoption of an Internal Procedures Manual.
Moreover, a significant number of other legislative acts have been incorporated into the Greek legal framework from EU directives concerning corporate law, thus creating a new set of rules regarding corporate governance. This includes Law 3693/2008, which requires the creation of audit committees and incorporating significant disclosure obligations concerning the ownership as well as the governance of a company.
Meanwhile, Law 3884/2010 deals with the rights of shareholders and additional corporate disclosure obligations in the context of the preparation of the General Meeting of shareholders while Law 3873/2010, incorporating Directive 2006/46/EC of the European Union into the Greek legal framework, concerns the annual and consolidated accounts of companies of a certain legal form.
Finally, in Greece, as well as in most countries, the Company Law regarding S.A. corporations (codified law 2190/1920, which is modified by numerous guidelines derived from many of the aforementioned EU Directives) includes the basic legal framework of company governance.
Corporate Governance Code
In compliance with the provision of Article 43a, section (d) of Law 2190/1920, which was added with par. 2, of article 2, of Law 3973/2010, and provides for the obligation of listed companies to create a corporate governance statement, referring to the applied code of corporate governance, the Company has voluntarily adopted the Hellenic Corporate Governance Council’s (HCGC) Corporate Governance Code (or “Code”) for listed companies.
The Code can be located on the Hellenic Corporate Governance Council (HCGC) website (http://www.helex.gr/web/guest/esed) at: http://goo.gl/xJkOVg.
Apart from the HCGC’s website, the Code is also available to all the employees through the intranet as well as in hard copy through the Group’s Finance and Human Resources departments.
The Corporate Governance Code, contrary to the mandatory provisions of the relevant laws, which have been mentioned above, is a self-regulatory text and constitutes a voluntary commitment on the part of the Company.
Deviations from the Code of Corporate Governance
The Corporate Governance Code follows the "comply or explain" approach and requires that listed companies, who choose to apply it, make their intention public and either comply with all the specific practices of the Code or explain the reasons for their non-compliance with certain specific practices.
The Company, on occasion, deviates or does not apply certain provisions of the Code in their entirety, in respect to the following:
• Size and composition of the Board
• Role and attributes of the Chairman of the Board
• Election of Board members
• General functioning and evaluation of the BoD
• System of Internal Control
• Level and structure of compensation
• General Meeting of Shareholders