On 18th May 2021 the MFSA ("Authority") published a Feedback Statement following a Consultation which pondered the need to revisit the Corporate Governance Framework. After receiving responses from a wide spectrum of industry participants, the MFSA carefully weighed the feedback.
Through the Consultation Document on Revisiting the Corporate Governance framework for entities authorised by the MFSA and Listed entities, the MFSA laid down several proposals to promote a comprehensive principles-based, cross-sectoral Corporate Governance Code, supplemented by sector-specific MFSA Rules and complementing guidelines/sectoral codes.
Some of the highlights of the above are the raised Corporate Governance standards for Authorised Persons, in order to assure that governance is held as a top priority, becoming intrinsic to a firm's culture.
The Authority did not approach the subject with a "one-size-fits-all" mentality, and went to great lengths in order to increase governance standards whilst also remaining mindful of the various types of entities falling under the framework.
The MFSA will be publishing a list of principles of Good Corporate Governance pertinent to all Authorised Persons on a "best effort basis", strengthened by additional industry engagement and focused policy work.
Overall, the current Codes of Governance for Listed Entities and Prospects will remain unchanged, and the framework will be applied exclusively to Authorised Persons.
"The publication of the MFSA Code of Corporate Governance and related policy work, will be a strategic step forward in achieving higher corporate governance standards by authorised persons. In implementing this holistic framework, the Authority remains committed to continuing engaging further with industry stakeholders and ensuring that good governance culture is properly embraced", stated Clare Farrugia, Head of Strategy, Policy and Innovation.
The MFSA's Chief Officer, Strategy, Policy and Innovation, Dr Michael Xuereb commented that "The adoption of the highest standards of corporate governance within the financial services market is key to ensuring the stability and integrity of the financial market, to enhancing public confidence, whilst fostering trust between authorised entities, investors and the general public".
It is essential for Authorised Persons and firms alike to remain up to date with the latest regulations. CSB Group's specialised team of professionals boasts expertise on matters of Corporate Governance, showcased throughout their services such as Malta Company Formation, Company Redomiciliation, Malta Branch Establishment, Directorship & Company Secretarial Services, Malta Back Office Administration, Malta Foundation Services, amongst many others.
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