Eliza Stasopoulou, a senior officer at the Cyprus Stock Exchange, recently underscored the paramount importance of implementing robust corporate governance and social responsibility policies within companies. This observation comes against the backdrop of a sector that has been under constant scrutiny and discussion at various conferences across Europe and globally in recent years, reflecting a collective effort to enhance and evolve industry practices.
Stasopoulou emphasized that the application of appropriate corporate governance rules significantly contributes to various facets of a company’s performance. By adhering to these rules, companies not only enhance their performance for shareholders but also improve their services and products. Furthermore, such adherence fosters transparency and rational management, instilling confidence among stakeholders.
She elaborated that corporate governance encompasses a comprehensive set of rules tailored to dynamic entities like companies, aiming to regulate various aspects to increase their value and safeguard their interests. These rules establish robust systems for monitoring and assessing corporate risks while ensuring transparency in decision-making processes by the company’s management.
According to Stasopoulou, empirical studies have consistently shown that companies effectively implementing corporate governance practices enjoy lower capital costs and increased value, as reflected in their stock prices. Moreover, Corporate Social Responsibility (CSR) has become increasingly critical for companies amidst the evolving socio-economic landscape. Companies are now expected not only to remain competitive but also to operate ethically and legally, contributing positively to the societies in which they operate.
The combination of Environment, Society, and Governance (ESG) has emerged as a pressing concern, with companies being urged to act responsibly for the benefit of society. Actions within these frameworks serve as a guarantee for investors of the proper functioning of each company, thereby adding value to their securities. Stasopoulou also highlighted the significance of EU Directive 2022/2464, which amends regulations concerning the submission of sustainability reports by companies, providing more detailed information on the subject.
In conclusion, Stasopoulou emphasized the proactive role of the Cyprus Stock Exchange in promoting corporate governance and social responsibility. The Exchange’s corporate governance code urges companies to incorporate environmental, social, and governance considerations into their actions, thereby showcasing their commitment to addressing societal and environmental concerns while delivering value to shareholders.