EFAMA warns against the negative impact of large-scale changes to the Shareholder Rights Directive

In its response to the European Commission’s public consultation and call for evidence on the Shareholder Rights Directive (SRD), the European Fund and Asset Management Association (EFAMA) calls for a targeted revision to remove practical barriers to shareholder participation, warning that wholesale changes to the existing rules could hinder the exercise of shareholder rights. Improving shareholder participation is a necessary step to foster investor engagement and advance the objectives of the EU’s Savings and Investment Union. To achieve this, EFAMA outlines several key priorities: 

Harmonising AGM timelines and meeting materials: The Commission needs to harmonise legal cut-off dates and bring both legal and custodian operational deadlines closer to the meeting date. The current 21-day notice period is routinely undermined by custodians requiring vote instructions two to three weeks before the AGM — sometimes before all documentation is even published. Meeting materials, including director biographies, proposal details, and accounts, must be available with sufficient lead time. Voters also need digitalisation of Power of Attorney requirements and for split voting to be made workable across all Member States.

Guaranteeing end-to-end vote confirmation: Shareholders should have automatic confirmation that votes have been validly cast, recorded, and counted by the company, not merely transmitted to the next intermediary. Rejection notices must be issued without delay so that shareholders can remedy errors before deadlines pass. Greater transparency of meeting outcomes, including granular vote tallies and the inclusion of Q&A exchanges in AGM minutes, is equally essential.

Establishing safeguards for all AGM formats: The SRD revision must introduce clear EU-level safeguards that cover the right to speak and to submit interventions, irrespective of the meeting format.  The hybrid meeting is the most appropriate format from an asset manager’s perspective, as it allows shareholders to choose whether to participate online or in person.

Preserving engagement reporting: The current comply-or-explain framework governing asset managers' annual engagement reporting works well and should be preserved. Stewardship is not a one-size-fits-all strategy: engagement approaches vary significantly depending on asset class, investment mandate, client expectations, and the nature of the company being engaged. The flexibility offered by the comply-or-explain framework allows asset managers to tailor their reporting to meaningfully reflect these differences. A prescriptive, rules-based alternative would risk reducing the quality and relevance of engagement reporting.

Protecting “say on pay”: The SRD's remuneration framework has delivered measurable improvements in Board accountability, company-investor dialogue, and long-term value creation. EFAMA firmly opposes any weakening of current “say-on-pay” provisions that could directly affect the assessment and attractiveness of companies.

Ilia Bekou, EFAMA Regulatory Policy Advisor, commented: “The SRD review is an opportunity to make shareholder rights work better in practice and calibrate existing impediments. We urge the Commission to focus on targeted improvements that deliver real outcomes for investors and strengthen trust in European capital markets. Stewardship aims at creating long-term value, and that requires a framework where participation in general meetings is practical, votes are traceable, and engagement rules are predictable.”

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Notes to Editors

You can find more info on the European Commission’s consultation here.

Read EFAMA’s full position on the SRD revision here and here.

For further information, please contact:

Hayley McEwen

Head of communications and membership development