19 October 2021

  • The draft technical standards specify the information that investment firms will have to disclose to show their influence over the companies in which they hold voting rights.
  • The standards put forward comparable disclosures and detailed instructions on investment firms’ voting rights, voting guidelines, and voting behaviour.

The European Banking Authority (EBA) published today new regulatory technical standards (RTS) on disclosure of investment policy by investment firms. The final draft RTS put forward comparable disclosures that should help stakeholders understand investment firms’ influence over the companies in which they hold voting rights and the impact of investment firms’ policies on aspects such as the governance or management of those companies.

The RTS put forward templates and tables for the disclosure of information on the investment firm’s voting behaviour, explanation of the votes, and the ratio of approved proposal, with the objective to show if the investment firm is an active shareholder that generally uses its voting rights, and how it uses them. They also include information on the use of proxy advisory firms that should help address uncertainties about potential conflicts of interest. Finally, they include information on investment firms’ voting guidelines, including, when relevant, a breakdown by geographical zone, economic sector or topic of the resolution being voted.

These disclosure requirements apply to class 2 investment firms with total assets above EUR 100 million. These firms will have to disclose this information in relation to those companies whose shares are admitted to trading on a regulated market and in which the proportion of voting rights exceeds 5 % of all voting rights issued by the company.

Implementation date

The first disclosure date will be 31 December 2021.

Legal basis and next steps

The Investment Firms Regulation (IFR) sets out in Article 52 the requirement for investment firms to disclose information on investment policy, including the following information: (1) proportion of voting rights attached to shares held, (2) voting behaviour, (3) use of proxy advisor firms and (4) voting guidelines. The same Article mandates the EBA to develop in consultation with the European Securities and Markets Authority (ESMA) draft regulatory technical standards (RTS) to specify templates for investment policy disclosure of investment firms. This information will be published on a yearly basis, along with the financial statements.

These final draft RTS were submitted to the European Commission for adoption.

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