More Transparency Rules added to the Cyprus Stock Exchange Corporate Governance Code

Nicosia, February 25, 2019

Corporate Governance Code of the Cyprus Stock Exchange added new rules that are aimed at investors’ protection and safeguard of the directors’ independence. The most relevant rules are provided below:

• It is now added the principle that every listed company must be headed up by an effective board of directors, which should lead and control the listed company. The board of directors should seek fair and equal treatment of all shareholders and be characterized by a high level of integrity. It is recommended that the companies’ board of directors be sufficiently diversified in terms of age, gender and educational and professional background in order to reflect a sufficiently wide range of experiences and facilitate the extraction of a variety of independent opinions and critical challenges;
• Any independent non-executive director does not receive or has not received from the company, during the 12 months preceding his appointment, any other material compensation besides his remuneration as a member, which must be approved by the general meeting of the company’s shareholders. It is also outlined that the remuneration of the executive and non-executive directors should be adequately justified in order for investors to understand the philosophy of the remuneration scheme as well as the actual remunerations granted according to this scheme.
• The members of the audit committee, a majority of whom, including the chairman, should be independent non-executive directors, should be named in the Annual Report. The president or any other member of the audit committee should have experience in accounting or audit. Thus, the board of directors by appointing the audit committee is required to establish transparent arrangements regarding financial reporting.