Transparency International Romania would like to draw your attention to the Shareholders' Rights Directive (2014/0121-COD), which is to be put to the vote in the next day's plenary.
Your vote on the adoption of the Directive, in the form adopted by the Committee on Legal Affairs, is an important contribution to improving the standards of corporate governance in European companies and to promoting fiscal transparency.
Increased transparency will help promote competitiveness and investment, while removing corrupt companies from the market. Publishing detailed business information will drive competition, revealing monopolies in some markets. It is anticipated that the measures foreseen in the Directive will generate economic growth, lower prices for consumers and increase competitiveness in the European business environment.
An assessment by the European Commission on the impact that the approval of the Directive will have in the future shows that the level of investment could increase as a result of applying this model of transparency, as investors will feel safer to invest in companies demonstrating actively with the highest degree of transparency. Also, more transparency can eliminate harmful practices that have emerged in recent years in multinational companies wishing to operate on the European market but wants to do so by exploiting the tax system to reduce their tax payments almost to zero .
The Shareholders' Rights Directive contains an important article Article 2 (amendment to Directive 2013/34 / EU) which will require large companies operating in Europe to publish data on countries where they declare their profits and countries where they pay taxes and duties. This is the provision we hope will bring the benefits described above.
Tax transparency will also contribute to the standardization of competitive conditions for European SMEs and multinational companies. At present, SMEs - the ones that most contribute to economic growth and job creation in European countries, are at a disadvantage to multinational companies that transfer their profits to tax havens.
In many cases, SMEs operating only in one country are already obliged to disclose much of the information that will be required to multinational companies through the mentioned directive. Therefore, it is not about imposing undue burdens on the business environment, but rather about creating a framework in which all types of companies, regardless of size, have equal chances. Several large banks and companies have already published online financial information, and their businesses have not suffered from increased transparency, on the contrary. In fact, 59% of senior executives of large companies advocate greater transparency by publishing key financial information within the company.
Given the undeniable benefits of this move to build an inclusive market, we are confident that you will support this initiative with your vote and that you will also promote its benefits among your colleagues.