Shareholder Rights Directive II
The Shareholder Rights Directive II (SRD II) is a European Union directive, which amends the SRD that came into effect in 2007 and sets out to strengthen the position of shareholders and encourage long-term engagement of EU listed companies’ shareholders. The directive and regulation provide times and methods for all the intermediaries to send information to their clients, including to the retail market.
SRD II will be applicable from 3 September 2020
Objectives of SRD II:
Ensure that all investors are incentivized to participate in the long life of the company
Facilitate the identification of the shareholders through the intermediary chain
Improve involvement of shareholders in corporate governance by attending and voting in general meetings
Encourage transparency in the investment strategy and control over a shareholder’s related-party transactions
Influence companies’ directors’ remuneration to create a better link between their pay and performance
Obligations of SRD II:
Intermediaries, including custodians and securities services providers, are required to facilitate a company’s right to identify its shareholders and to facilitate the exercise of a shareholder’s rights.
Institutional investors and asset managers must be more transparent regarding their engagement policies and investment strategy by making their voting policies public.
Monte Titoli’s Role:
Monte Titoli is working closely with market operators, market associations, regulatory bodies and main domestic and European working groups, to ensure that the market participants have procedures and systems in place to fulfill the obligations of the Directive.
By September 2020 Monte Titoli will upgrad the domestic and international General Meeting operating model and processes to respond to the Directive requirements to provide for:
Transmission of the Shareholders' Meeting notice and related updates, by means of messaging conveyed via the RNI channel, SWIFT 15022 and MT-X.
Confirmation of the legitimacy of the shareholders to exercise their rights at the Shareholder’Meeting and Notice of participation of the shareholder at the Shareholders' Meeting and related updates, by means of directive compliant messaging in ISO 20022 and proprietary format, conveyed via the MT-X platform with both U2A and A2A interaction.
The Operational Model of the service and the Operating Manual is available onthe MT-X platform in the section “Home > Documentazione > Documentazione Tecnica > Tracciati Utente in lavorazione > Shareholder Rights Directive II” and on the portal MyStandards,
Currently, information on shareholders identity and other corporate actions events are already part of the local regulatory framework and compliant with the new directive. Monte Titoli, is planning to fully implement all messages on a voluntary basis with its participants