- The Brazilian Central Bank and the Brazilian Securities Commission (CVM) recently issued standards aimed at greater transparency in managing mutual investment funds. These standards apply new risk classification criteria to such funds, and require their administrators to provide investors with prospectuses containing transparent, clear, and objective data. Within this same context, ANBID (National Association of Investment Banks) has drawn up a self-regulation bill containing rules to define the method whereby fund results are to be disclosed and what these prospectuses should contain. This would seem to be a timely occasion for enforcing the inclusion in prospectuses of funds whose portfolios include shares, information on procedures for exercising voting rights in shareholders’ meetings. In this way, an investor in share funds has the option to select "passive" share funds or "active" share funds. In other words, funds requiring personal attendance at shareholders’ meetings and the exercising of the right to vote held by the shares under its management, and to subsequently update the shareholders on the position taken at such meetings. Other vital information to be given is whether powers-of-attorney were granted, the implications of the respective vote, and to whom such powers-of-attorney were granted. Although the use of the proxy system for representing shareholders in Brazil is significantly less complex than in the USA, the number of proxy shareholders in publicly traded companies, attending shareholders’ meetings increases annually, and this includes investment funds. Further information on this matter is given in the article, "Let’s drag proxy mutual fund votes out into the light", published in the Technical Material section of this home page.

- The new complementary pension regulations in Brazil, close to Federal Congress approval, will ensure the growth of Brazilian pension fund reserves from the present sixty-five billion US dollars (US$ 65,000,000,000) to close to three hundred billion dollars (US$ 300,000,000,000) in ten (10) years. Needless to say, a significant portion of this increase will be allocated to the share market, a move that will intensify the Brazilian pension fund demand for tougher corporate governance practices in their investee companies. The Associação Brasileira das Entidades Fechadas de Previdência Privada – ABRAPP (Brazilian Private Pension Fund Association), which represents all Brazilian pension funds, has been keeping a watchful eye on this important matter. Under the coordination of its Southwestern Regional Director, Nelson de Albuquerque Nonô and in association with the Instituto Brasileiro de Governança Corporativa – IBGC (Brazilian Corporate Governance Institute) ABRAPP is organizing an event that will take place on March 15 in Rio de Janeiro, specifically to discuss the Brazilian Code of The Best Practices in Corporate Governance.

- The increased demand for better corporate governance practices is clearly evidenced by the most recent count recording forty-nine (49) codes in twenty-one (21) countries. As part of its analysis of the similarities and differences between the more complete codes, the Business for Social Responsibility (BSR) published a comparative code. Its summary contains an analysis of corporate governance related topics, such as, consulting committees, compensation of directors, independent directors, division of powers, the organization’s corporate liability, etc. BSR suggests that its comparative could "serve as a reference for companies seeking to create their own governance guidelines or to assess or perhaps strengthen their existing guidelines."

- The National Association of Corporate Directors – USA (NACD) has released the results of its 1999 survey of Corporate Governance in US private unlisted companies. This survey was carried out under the auspices of the NACD, by its former president, James Darazsdi, and is the Association’s first attempt to examine the performance of boards of directors of US private unlisted companies. The survey included a sampling of one hundred and sixty-five (165) organizations from a variety of sectors of the US economy, from those billing less than five million US dollars (US$ 5,000,000) to over one billion US dollars (US$ 1,000,000,000) per annum. The results of this survey are shown in their entirety in the Technical Material section of this home page.

- The trend towards reinforcement and increased exercising of minority voting rights has become a global phenomenon. The DOW Jones Newswires recently published the news that minority Russian shareholders of NK Yukos succeeded in obliging the Arbitration Court of Samara, a town 1,000 Km outside Moscow, to annul a share issue which would result in a more than 200% dilution of the company’s capital, based on evidence that their presence had been barred and, they were thus prevented from voting at the meeting approving such share issue.