OECD Secretary-General's Second Report to G20 Finance Ministers and Central Bank Governors on the Review of the G20/OECD Principles of Corporate Governance
Overview:
The report provides an update on the progress of reviewing the G20/OECD Principles of Corporate Governance since the February 2022 meeting. It highlights the importance of corporate governance frameworks and capital markets in supporting economic recovery post-COVID-19.
Key Developments:
- G20 Support: G20 leaders endorsed the decision to review the G20/OECD Principles of Corporate Governance at the 2021 G20 Summit and at subsequent FMCBG meetings.
- Committee Participation: All but one G20 country now has Associate status in the Corporate Governance Committee, enhancing participation and influence in the review process.
- Priority Areas: Ten key areas identified for consideration include climate change, corporate ownership trends, digital technologies, crisis management, and executive remuneration.
Reports Discussed:
- "Climate Change and Corporate Governance" - Examines climate change's impact on corporate governance, focusing on shareholder roles, stakeholder engagement, disclosure, and board responsibilities.
- "Digitalisation and Corporate Governance" - Explores the integration of digital tools in strengthening corporate governance practices, market supervision, and compliance.
- "Institutional Investors and Stewardship" - Discusses the growing role of institutional investors globally, the evolution of engagement and stewardship strategies, and the regulatory landscape.
- "Role of Board-Level Committees" - Analyzes the expanding responsibilities of board committees in managing complex corporate environments.
Next Steps:
The review will continue throughout 2022, aiming to deliver revised G20/OECD Principles by 2023 for endorsement by G20 leaders. The updated principles will emphasize addressing contemporary challenges such as climate change, digital transformation, and evolving corporate structures.
Conclusion:
The G20/OECD Principles of Corporate Governance serve as a foundational framework for evaluating and improving corporate governance policies worldwide. The ongoing review aims to enhance these principles to better align with current economic realities and technological advancements, ensuring robust and sustainable corporate practices.
