Corporate Governance in Poland - slides

Corporate Governance II
Dr. Udo Braendle
WS 2011/12
CORPORATE GOVERNANCE in POLAND
Silvia Dorner (9503564)

CORPORATE GOVERNANCE IN POLAND
AGENDA
Historical overview
The Code of Best Practices for WSE Listed Companies
Some key features
Ownership structure on WSE
Some crucial points

CORPORATE GOVERNANCE IN POLAND
Historical overview
1934 Commercial Company Code enacted
1945-1989 only government owned corporations
1990’s massprivatiztion programs
1991 Warsaw Stock exchange (WSE) opened
1.1.2001 Commercial Company Code updated and modified
2002 The Code of Best Practices for WSE Listed
Companies
2010 update of Code of Best Practices for WSE

CORPORATE GOVERNANCE IN POLAND
The Code of Best Practices for WSE Listed Companies
Private initiative: professional associations and interest
groups (like Austria, UK, Finland)
condition for listing
generally based on ‘comply or explain-principle’ especially in
sections II, III, IV
recommendations in section I
related to OECD Principles of CG, EASD CG-Principles, British
CG-Code
annual published ranking of corporate governance by Polish
Forum for Corporate Gowernance (PFCG)

CORPORATE GOVERNANCE IN POLAND
Some key features
corporate law: very similar to Austria and Germany
two tier board system (supervisory board, managing board)
committees - when deemed necessary
no mandatory employee representatives in board, except:
privatizised corporations
dual class shares issued:
voting shares (with one or multiple voting rights - max 5)
non-voting shares (grant only divident)
companies with high percentage of foreign ownerhisp
transparent corporate governance structures

CORPORATE GOVERNANCE IN POLAND
Ownership structure on WSE
high ownership concentration:
- families
- non-financial companies
- financial companies
- State, Public authorities (significant high)
resource: www.gwp.pl
%
50
45
40
35
30
25
20
15
10
years
5
0
33
30
37
39
18
43
37
36
47
34
27 19
2007 2008 2009 2010
foreign domestic individual domestic institutional

CORPORATE GOVERNANCE IN POLAND
Crucial points
corporations with major governmental ownership
very strong positions of management board
little force of supervisory board („nadwislanski“ CG-Model)
Little independence of autid commitees
source:
Study on Monitoring and Enforcement Practice in
Corporate Governance of the Member States

CORPORATE GOVERNANCE IN POLAND
Crucial points
protection of minority shareholders
stakeholder rights (employees)
very little discosure of variable remuneration
fixed sallaries about 81 %, bonus: cars, etc:
Study on Monitoring and Enforcement Practices in Corporate
Governance in the Member States (2009):
o assessement of Polish Corporate Governance Code is below European
Median score
o Many issues are not sufficient treated in Polish CG-Code

Thank you for your attention!

CORPORATE GOVERNANCE IN POLAND - REFERENCES
Kowalewski O., Stetsyuk I., Talavera O. (2007), Corporate Governance ande Dividend Policy in
Poland, Wharton Financial Institutions Center Working Paper No. 07-09,
http://fic.wharton.upenn.edu/fic/papers/07/0709.pdf
Kozarzewski, P. (2003), Nadzór korporacyjny i wtórna prywatyzacja w Polsce: ramy prawne i
zmiany w strukturze własnościwej,
http://www.case.com.pl/plik--1716631.pdf?nlang=19
http://www.corp-gov.gpw.pl/publications.asp
http://fic.wharton.upenn.edu/fic/papers/07/0709.pdf
http://www.finanse.egospodarka.pl/63920,Akcje-prywatyzowanych-spolek-inwestorzyostrozni,1,48,1.html
http://www.finanse.egospodarka.pl/63920,Akcje-prywatyzowanych-spolek-inwestorzyostrozni,1,48,1.html
http://www.etykabiznesu.pl/index.php?option=com_content&task=view&id=941&Itemid=78
http://ec.europa.eu/internal_market/company/docs/ecgforum/studies/comply-or-explain-
090923_en.pdf