Bucharest Stock Exchange, European bank release new corporate governance code

The European Bank for Reconstruction and Development (EBRD) has collaborated with the Bucharest Stock Exchange (BVB) in the development of a new code of corporate governance for a sustainable development of the Romanian capital market.The main changes in the Code of Corporate Governance and the schedule of the training for issuers and stakeholders, which is to start this March, were presented at a conference at the BVB headquarters.Representatives of the two entities, alongside renowned stakeholders of the capital market in Romania and from abroad, outlined the importance of corporate governance and, in particular, of the BVB's Code of Corporate Governance for the sustainable development of the Romanian capital market, according to a BVB press statement."We are proud to partner with the BVB on its corporate governance code, a testament to Romania's dedication to building a robust and competitive corporate ecosystem. The code will strengthen market dynamics, create the foundation for sustainable growth and ensure engagement of companies with their investors to maximise the transformative potential of corporate governance reforms," said EBRD Director for Romania Victoria Zinchuk."We, at the Bucharest Stock Exchange, use to say that the stock exchange is a stage onto which the listed companies walk and introduce themselves to their investors and clients. The healthier the governance principles applied by companies, the more likely they are to be seen on this stage. The additions to the Code of Corporate Governance made by the relevant experts, with EBRD's support throughout this process, feature the natural development, the harmonisation of the code provisions with the recent regulatory amendments, with the best practices in the industry, with the latest Corporate Governance Principles of the Organisation for Economic Co-operation and Development (OECD) and with market participants' priorities," said Chairman of the BVB Board Radu Hanga."Even the names of the partners involved in the revision of the Code of Corporate Governance send out a powerful signal on the importance of this undertaking completed last year, which will also contribute to the increase in the prospects of Romania's accession to the Organisation for Economic Co-operation and Development (OECD). Good governance illustrates, among others, the harmonisation of stakeholders' interests with the company's interests. Any investor, when deciding to invest in a company, will do so because they see the story of growth behind that business, as well as the corporate governance applied by the company," according to BVB CEO Adrian Tanase.Having EBRD's support, BVB initiated last May the revision of the Code of Corporate Governance in order to bring it in line with the recent regulatory changes, among others. The main purpose of the code is to support issuers' corporate resilience in a rapidly changing world, to increase market resilience and access to capital and to foster innovation and sustainable practices.In the revision of the code, BVB and EBRD were supported by representatives of some renowned institutions from the international governance landscape and from the Romanian private and public sector: The General Secretariate of the Romanian Government, the Agency for State Enterprise Monitoring and Evaluation, the Financial Supervision Authority, the Romanian Association for Investor Relations, which is the promoter of the concept of investor relations in Romania, Envisia-Boards of Elite, which is the business school for members of the board and executive managers, and Sodali & Co.The new Code of Corporate Governance was made public in December 2024. The main changes thereto include: making a distinction, in the practical transposition of the code, between the companies managed under the unitary system and those managed under the dual system; annually monitoring by BVB of the issuers' compliance with the code provisions; adding the section dedicated to Sustainability in order to prepare issuers for a smoother adoption of the sustainability legislation; the need for the Board of Governors (BG) to develop a profile of the Board in order to guide the recruitment and succession process.Also introduced was the recommendation to have an independent vice-chairman in BG when the positions of chairman and general manager are held by the same person.Other changes relate to BG's annual evaluation; introducing a training dedicated to BG upon its appointment and a subsequent training, where required; remunerating BG's members as per the Company Remuneration Policy; recommending an Investor Relations Officer (IR) to report directly to the general manager or to the financial manager; recommending a risk management officer, including emerging risks; adding additional independence criteria for BG members and members of the audit committee, with reference to those in the Law on companies.The code is applicable to all companies listed on the BVB main market. The first year of reporting for compliance with the new code is 2026, for the financial year 2025. BVB will annually monitor the issuers' compliance with the code of corporate governance and will publish annually an aggregate monitoring report.A schedule for the training dedicated to issuers and other stakeholders in the market was also presented at the conference . Thus, further to the conference, BVB and BERD, with support from Envisia-Boards of Elite, as the institutional training partner, will facilitate their access to the following educational programmes: in March 2025, six workshops on the code and its implementation will be organised for issuers, institutional investors, mass media, consultants and other interested parties; in April-June and September-November 2025: two series of 1:1 meetings on the code implementation will be held between BVB senior experts and issuers' representatives; in January 2026, workshops regarding technical aspects on reporting under the code will be held for issuers.In 2024, the EBRD invested euro 707 million in Romania. Since cooperation was initiated in 1993, the Bank has engaged more than EUR 11.5 billion for 551 projects in the country, of which 82% in the private sector.BVB is the only securities market operator in Romania. BVB, listed on its own market since 2010, is part of the BVB Group that includes the Central Depository, the institution responsible for the register and settlement operations in Romania, and, since October 2019, the central counterparty, i.e. CCP.RO, an institution that is to take up the clearing of securities transactions in Romania and to contribute to the re-launching of the market of derivative products. BVB manages two separate markets, the Regulated Market and the Multilateral Trading System, which list a variety of financial instruments such as stocks, bonds, fund units, certificates, structured products, and preferential rights.It concluded a record number of transactions in 2024, amounting to 2.6 million, an extra 32% compared to 2023, a record capitalisation of listed companies amounting to RON 363 billion, which accounts for an extra 18% compared to the previous year and an advance rate of 8.8% for BET index and of 16.1% for BET-TR index, respectively.