Financial Regulation and Compliance, Socratis Lazaridis raises the question of whether Greece can have an effective enforcement of Corporate Governance principles and structures. According to him, Greece is classified among the Continental European corporate governance pattern characterized by concentrated ownership, a dominant role for majority shareholders and a weak market for corporate control. The law 3016/2002 was an unsuccessful attempt to attract investments in Greece, and it has brought no results in improving the fundamental elements of the Greek corporate environment. Lazaridis is in favor of a flexible legal framework that will be easy to apply and therefore effective in terms of helping Greek corporate environment open up to the global competitive scene. I personally agree with Lazaridis. I believe that in order to positively affect the performance of Greek companies, we must sufficiently enforce the current existing initiatives in the Greek legal framework. For example, executive remuneration is not dependent on performance, power and control structure, monitoring of efficiency and incentive plans. Such inefficiency is moreover a domestic feature, since the law 3016/2002 failed to establish an independent monitoring mechanism or to enhance the efficiency of the existing ones. As a contradiction, Charilaos Mertzanis in his article "The effectiveness of corporate governance policy in Greece" (2011) states that: "the rules and conventions that a country will have down the road will depend on the type of corporate structures and corporate rules that it began with." While the role and gravity of legal framework and regulation is important, equally important are differences in enforcement (law effectiveness) which take into consideration other economic and institutional factors. In other government and its regulations, it is the market in its effort to regain balance that will regulate itself. Greece has no distinct Corporate Governance Code. Law 3016/2002 is a fragmented regulation for the conduct and behavior of a board of directors and its members, executive or not, the auditing procedures and the general inner control of the company. Compared to foreign Codes of Corporate Governance, the Greek law lacks in depth analysis and sufficient coverage of practical guidance. The writer's opinion is that a new quasi-legal instrument which will have a legally binding force would not only be preferable but mandatory. A fresh legislative view on the matter of related party transactions and financial reporting is the UK Enterprise and Regulatory Reform Act 2013 ("the 2013 Act") which amended Part 10 of the Companies Act 2006 ("the 2006 Act"). Executive remuneration and reporting is a hot potato that is crucial for most investors. The ideas of: single figure for a director, like Greece too. Before concluding, it is worth mentioning that we expect the Ministry's reaction on a recent commendable amendment proposal from the Capital Market Commission for the law 3016/2002, which will concern Greek listed companies operating in Greece or in the EU. The general idea behind this amendment is the diversification in details for disclosed RPTs depending on their size compared to the value of the company. The Greek corporate environment is in need of a new Reforming Act which will be a result of a joint effort between the Hellenic Capital Market Commission, the Government and the Hellenic Federation of Enterprises. We must avoid the random and scattered approaches which have been the norm up to today. What we need is a coherent all around approach of CG and RPTs in Greece. A new regulation that will cover all aspects of modern Corporate Governance and will not concern for example only the taxation like IAS-24 does, or the board of directors as law 3016/2002. Any solution cannot disregard social factors, governance models and a cost/benefit analysis. |