Last January, the Portuguese Securities Commission (CMVM) enacted Regulation 1/2010 of January 7 2010, on corporate governance, introducing internationally accepted corporate governance rules. Fully effective January 1 2011, the Regulation requires listed companies to adopt a corporate governance code in accordance with the principles and practices of good governance provided therein.
In general, the governance code must set a legal framework that widens the protection of shareholders' rights and fosters governance transparency. In addition, it must address several matters included in the model of governance code prepared by CMVM.
The Regulation further imposes the disclosure of certain information, including, without limitation, the remuneration of members of the managing and supervisory bodies of the companies.
The new rule marks the rejection of the so-called one-size-fits-all model in Portugal, as companies are given the chance to use a tailor-made governance model better suited to them. The implementation of this tailor-made model, aimed at increasing transparency and disclosure standards, rebuilds confidence, making companies increasingly able to finance themselves in the market.