Best Practice for GPW listed companies 2021

The Exchange Supervisory Board in its Resolution No. 13/1834/2021 of 29 March 2021 approved the new principles of corporate governance for companies listed on the GPW Main Market: the Best Practice for GPW Listed Companies 2021 (“Best Practice 2021” or “Best Practice”). It is a new edition of the code of corporate governance for companies listed on the GPW Main Market, originally approved in 2002.

The Best Practice 2021  came into force on 1 July 2021. Companies’ compliance with the principles of corporate governance defined in the Best Practice is optional. However, listed companies are required to disclose compliance in accordance with the GPW Rules. Companies are required to publish their disclosures of compliance with the Best Practice 2021 for the first time no later than 31 July 2021.

Drafting the Best Practice 2021

The code of corporate governance has been reviewed and updated on a regular basis. Similar to the Best Practice 2016, the GPW Corporate Governance Committee was responsible for drafting and editing the new Best Practice. The Committee is comprised of Polish capital market institutions and participants as well as independent corporate governance experts (for details of the committee, click here). The public consultation of the draft Best Practice 2021 prepared by the Committee opened on November 2020. Following comments raised by issuers, investors, institutions working towards high standards of corporate governance of listed companies, and leading experts, the text was extensively amended and largely improved.

What has changed?

The new Best Practice reflects current trends and follows European regulations of corporate governance. The update integrates the present legal status and recent trends of corporate governance and addresses the proposals of market participants interested in improved corporate governance of listed companies.

Compared to the previous version of the Best Practice, the structure of the new document has been modified. The mix of recommendations and principles has been eliminated. Each section now opens with general principles which define the goals to be pursued by companies in relevant areas, followed by specific principles subject to mandatory reporting.

The clear and concise language of the Best Practice 2021 and its transparent structure are designed to facilitate the interpretation of the principles by issuers and investors, supporting their application and the disclosure of best possible explanations.

Principles of corporate governance initially established as codes of best practice based on the comply-or-explain approach often become law. As a result, the new Best Practice no longer covers matters governed by the Act on Auditors and the Act on Public Offering. Thus, the Best Practice is consistent with legislation without copying existing regulations. The Best Practice 2021 may have to be updated due to dynamic evolution of the law, in particular the Commercial Code.

To address the expectations of market participants, the new Best Practice covers ESG factors including climate, sustainable development, diversity on corporate bodies, and equal pay. As fair treatment of shareholders is a pillar of corporate governance, new principles address profit distributions, issues of shares with the exclusion of subscription rights, and share buy-backs. The Best Practice puts an emphasis on the preparation of general meetings: it sets deadlines for shareholders to propose draft resolutions, clarifies the process of nominating and appointing candidates to the supervisory board in accordance with the legal requirements for members of the audit committee and the diversity policy established in compliance with the applicable principle of the Best Practice.

  Best Practice 2021 - booklet - Polish language only

  Best Practice 2021 - booklet (for printing) - Polish language only

Best Practice 2021 - PRESS RELEASE