The Malta Financial Services Authority launched a stakeholder consultation seeking to “raise compliance standards across the board”. In a statement, the MFSA said that the public consultation was setting out several proposals for the declaration of a comprehensive principles-based Corporate Governance Code which is applicable to all entities authorised by the MFSA and Listed Companies, which would then be supplemented by sector-specific rules and complementing guidance notes. The MFSA CEO Joseph Cuschieri said that “We believe that the proposals set out in today’s publication will significantly raise the bar with respect to standards of corporate governance and set the tone in so far as the Authority’s expectations.
Apply, comply, explain
The Authority is proposing that entities will be expected to ‘apply and explain’ the high-level principles-based code and to ‘comply or explain’ how they are following the applicable rules and guidelines. The consultation also puts forward principles, for inclusion in the proposed Corporate Governance Code, on the Board of Directors, the responsibilities of functionaries and officials, engagement with stakeholders, committees, corporate culture, ethics framework, risk management, as well as other topics.
Cuschieri added that “We have put forward these proposals because we believe that the focus on corporate governance will have a positive effect on the financial services industry and will raise compliance standards across the board”.