Shareholders’ Rights regulation
The undercover game changer
The Shareholders’ Rights Directive II (SRD II) is an example of a regulation that flew just under the radar for all stakeholders, ever since its negotiation phase before 2017.
The purpose of SRD II is to allow retail investors to participate in the life of the companies in which they invest, and ensure long-term engagement. The EU Commission was of the view that investors were not well informed about their investments, hence too easily willing to dispose of them if news (and stock prices) were not satisfactory.
This phenomenon easily created a short-term view of investments, which is adverse to the development of strong EU firms. SRD II is therefore designed to help investors develop long-term involvements and become active in the companies they invest in.
Performance magazine issue 31, January 2020
Performance is a triannual digest, dedicated to investment management professionals, which brings you the latest articles, news and market developments from Deloitte’s professionals and clients.