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NEWSLETTER - July 2016


ecoDa's opinions and activities


ecoDa/PwC Guidance for audit committees on the EU audit legislation

ecoDa and PwC issued a Guidance for audit committees at the time the EU Audit legislation came into force (17 June). The EU Audit legislation introduces more detailed requirements regarding the statutory audit of ‘Public Interest Entities’ (PIEs). 

Given that the functions assigned to audit committees have been extended in various ways, ecoDa and PwC have decided to help audit committee members understand the main changes by providing a description of different aspects of the new legislation, focusing on the composition and governance of audit committees, selection and appointment of the audit firm, monitoring the independence of auditors, auditor reporting requirements and oversight.


ecoDa / PwC Conference on the Audit Committees at the heart of the Audit Reform

On 21st June, PwC and ecoDa held a joint conference in Brussels on the theme of “Audit Committees at the heart of the Audit Reform" in presence of Alain Deckers, Head of Unit, Audit and Credit Rating Agencies, DG FISMA from the European Commission. The goal was to focus on the Corporate Governance implications of the EU Audit legislation. 
Daniel Lebègue, Honorary Chair of the ecoDa,reiterated that Audit Committees should not be seen as separate bodies from the boards. Audit Committees’ members are appointed by the board whereas the board is appointed by the shareholders. It should not lead to a situation in which the audit committee is regarded as a body that is distinct (and distant) from the board as a whole. This would be a negative development. If Audit Committees were to become a specialised and stand-alone component of financial compliance, it would be detrimental to the overall standard of corporate governance within the EU. Good governance is best served if the skills and experience of the entire board – supported but not replaced by the audit committee - are brought to bear on issues of financial oversight and audit. The conference has been video recorded.


ecoDa's Response to the consultation on non-binding guidance on non-financial reporting

ecoDa responded to the EU consultation on non-binding guidance for reporting non-financial information. We are in favour of all initiatives that support long-term sustainability and better accountability. As a consequence, we believe that good Corporate Governance requires adequate attention to non-financial reporting.

This being said, we also acknowledge that requirements of far-reaching and detailed reporting of non-financial information might involve significant administrative work, especially demanding for companies in the smaller-size end of those affected by the directive. ecoDa therefore considers it of utmost importance that EU-level regulation is constrained within limits that do not risk to jeopardize the competitiveness of European listed companies vis-à-vis other ownership models and their overseas competitors.


European Small and Mid-Cap Awards 2016

ecoDa is now taking part in the jury meetings in preparation of the European Small and Mid-Caps Awards 2016. The overall objective of these awards is to create a favorable environment for companies seeking growth capital. The awards are organised by the European Commission (DG Grow), EuropeanIssuers and FESE (Federation of European Securities Exchanges). The Awards Ceremony will take place in Brussels on 17 November 2016.


ecoDa's Gala Dinner on Trust in Boards

In April, ecoDa held its gala dinner at the Cercle de Lorraine with its members and corporate associates to discuss “Trust in boards”. The dinner was sponsored by Standard Life Investments.

Different questions were addressed:

  • Does the new legislation  increase the accountability of boards while moving away decision-power from the board towards shareholders and supervisors?
  • Aren't we moving from a collegial decision-making body towards specialised committee obligations, Is there a tendency for boards to become more technically oriented rather than strategy oriented?
  • Does transparency really build trust?


Video and Report of ecoDa's Annual Conference

ecoDa organised its annual conference on "Are European Boards Ready for a Digitalized World?". Digitalization changes business models. There is a clear need for boards to respond with strategic decisions based on understanding of how digitalization affects their business model. Digitalization has also impacts on the way boards should be shaped. 

At the conference, a report from the business school INSEAD and thisfluidworld based on real perceptions and experiences of managers on the ground was issued.

Another survey conducted by Digoshen confirmed that board members are often suffering from competence gap; they need insight in digital developments.

The videos of the conference are now available.


ecoDa enlarges its Membership in Iceland

Reykjavik University Center for Corporate Governance has just joined ecoDa as an academic member.


ecoDa ongoing activities

ecoDa is about to launch a new series of webinars with AIG and FERMA. Next webinars will tackle the following topics: Cybersecurity (Comparison EU / US), Corporate Transparency, Business & Terrorism, Risks and Opportunities in the Sharing Economy. At the time of the European 18th CG Conference, ecoDa had a meeting with the European Corporate Governance Codes Network (ECGCN) to finetune its second survey on the Comply or Explain Principle (the role of the board in developing good governance practices). ecoDa will be engaged in a new project with Korn Ferry on the impacts of digitization on boards.


ecoDa visible at different European Conferences

ecoDa took part in the 18th European Corporate Governance Conference organised by NCD in May 2016. At that time, Lutgart Van den Berghe (Chair of ecoDa' policy committee) compared the OECD approach towards the EU approach in terms of CG. "The EU route for governance matters is mainly one of soft regulation but embedded in an EU wide regulation. There is an increasingly wide set of governance related legislation. The route of self regulation led to a slow but gradual process of more alignement across EU as to what can be considered building blocks of good governance”.

Turid Elisabeth Solvang, ecoDa's Chair, will be speaking at the EwoB-FidAR Conference on "Women on Boards - Boarding in Europe" on July 7.


ecoDa is a partner of the 19th European Corporate Governance Conference 27 October 2016, Bratislava


Get Registered to ecoDa's 2 Days of Professional Development for European Directors


EU Information


The entry into force of the EU audit legislation

The EU audit legislation came into force on 17 June. The European Commission published further “questions and answers” on the new EU rules on statutory audit to help for a smooth implementation. These answers should be read together with the ones published on September 2014 and February 2016.

Amongst other questions that were asked:

o   When does an entity become a PIE? How does this impact on the calculation of the duration of the audit engagement?

o   Which regime will apply to PIE audit engagements entered into after the entry into force of the new rules?

o   What will be the impact of the new rules on the composition of audit committees?

The Federation of European Accountants has published a document illustrating the status of Member States’ implementation of new EU Audit rules.


A revamped EU legal framework on Market Abuse, applicable as of 3 July

This legislation aims at increasing the transparency in the securities markets, and therefore the top management (for example members of the Board of Directors) of the listed companies needs to notify the persons closely associated with them (family members and legal persons where they hold e.g. a board position) of their obligations under the MAR. The obligations also extend to the family members and to the legal persons where family members have such positions.

ecoDa is concerned that the translation of the Directive differs in some countries from original text and that is why some countries (Finland) are forced to include wider group of organizations.


Shareholders' Rights Directive

While several legislative initiatives are held in countries like France to allow a binding “say on pay”, the trialogues on the Shareholders' Rights Directive are still blocked. See an interesting academic paper on: European Shareholder Rights Directive Proposals: A Critical Analysis in Mapping with the UK Stewardship Code?



  • The French IFA will organize a breakfast session on "Relationship between boards and shareholders: international developments and issues on 23 September in Paris - with ecoDa's participation.
  • ecoDa's last board meeting was hosted by its German member institute, VARD at the time of their 9th German Board Conference in June. The next board meeting will be hosted by the British IoD raffirming their membership to ecoDa despite the Brexit (28 September).
  • The 2016 Global Network Directors' Institute (GNDI)'s executive meeting will be held in Johannesburg, South Africa on 2 November 2016.


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