Committee on Economic and Monetary Affairs

Responsibilities, contacts and latest studies of the Committee on Economic and Monetary Affairs

The Committee is responsible for:

1. the economic and monetary policies of the Union, the functioning of Economic and Monetary Union and the European monetary and financial system (including relations with the relevant institutions or organisations);
2. the free movement of capital and payments (cross-border payments, single payment area, balance of payments, capital movements and borrowing and lending policy, control of movements of capital originating in third countries, measures to encourage the export of the Union’s capital);
3. the international monetary and financial system (including relations with financial and monetary institutions and organisations);
4. rules on competition and State or public aid;
5. tax provisions;
6. the regulation and supervision of financial services, institutions and markets including financial reporting, auditing, accounting rules, corporate governance and other company law matters specifically concerning financial services.

Meeting documents

Contacts

E-mail: ip-ECON@europarl.europa.eu

Fax:
+32 2 28 49025 (Brussels)
+33 3 881 79070 (Strasbourg)

Latest studies of the Committee

The Economic Consequences of Large Shareholder Activism

While ownership and control were under the effective supremacy of the firm’s (factual) owners at the beginning of the 20th century, the 21st century was entered by listed companies of which the growing size and the dispersion of ownership have paved the way for public corporations entailing systemic risk that are often characterized by a separation of ownership and control, coinciding the well-defined agency problem. While the agency problem was first attempted to be covered by monitoring mechanisms offered by the law – i.e. (i) the market for corporate control; (ii) the legal, political and regulatory system; and (iii) the internal control system – the modern corporate governance wave applies itself to the rights and responsibilities of shareholders as the owners and monitors of public corporations. The central figure in this debate are large shareholders who have acquired a reputation of being able to successfully affect corporate decision-making process of corporate boards. The features of large shareholder activism, however, have come under great scrutiny. A variety of studies indicate that under the vein of corporate monitoring, the activities of large shareholders circumvent the existing legal devices regulation investor voice and give rise to substantial concerns in the corporate governance arena. Commissioned by the European Parliament in January 2009, this study contemplates on the economic consequences of large shareholder activism in five European countries (Belgium, France, Germany, the Netherlands and the UK) and refers to two other countries (Italy and Spain).

Full Report (15.07.2009)

Source: European Parliament