The Norwegian retail activity has bursted during 2020, and Euronext Growth has now 60 000 retail investors

Euronext Growth (previously Merkur Market) started out the year by having approximately 10 400 retail investors. Overall, the year experienced double-digit growth figures during 7 of 11 months. August was the month with the strongest growth, where the number of investors more than doubled up to 44 000. By the end of November Euronext Growth had just under 60 000 retail investors which entailed a year to date growth of approximately 475%, compared to the 450 000 local retail investors on Oslo Børs Main Market that saw an increase of local investors by 18% by the end of October. The number of investors is expected to increase further in 2021, though not at the same pace.

2020 has also seen record numbers in listings on Euronext Growth, and 2020 is expected to end on 49 listings. Share savings accounts (ASK) for equities has increased by 46% and has now passed 560 000 accounts.

2020 has for sure been a special year for all of us, and it will be interesting to see what 2021 will bring.

Happy New Year to all of you, Euronext VPS wishes you all the best. See you in 2021!

Important information about 2021 tax reporting dates

Please see attached letter for the dates in question.

Companies operating in the financial sector are required by law to monitor and report on their employees’ personal trading activity. By using Tradelog, a web-based compliance tool developed by Euronext Securities Oslo, companies can automate the entire trading activity governance process, saving valuable time and resources, as DNB Markets has experienced.

The administrative aspect of monitoring employees’ personal trading activity can be time-consuming for financial institutions, a fact to which Hanne Leirbukt Pedersen, Chief Compliance Officer at DNB Markets, can attest. “It was an area that had become increasingly work intensive for DNB Markets in recent years,” she states. Part of the reason for this growing workload was the company’s largely manual application and approval process. “Prior to using Tradelog, we used a homegrown solution with a Microsoft Excel-based application form and a Microsoft Access-based follow-up form. This solution required a great deal of manual work, which is why we were looking for a system that could automate many of these manual tasks.”

Automation helps create a more efficient process

With Tradelog, DNB Markets has automated the entire trade monitoring process, which starts when an employee begins working in the company. “All DNB Markets’ employees are required to register their securities holdings in Tradelog when they start working for us,” Hanne Leirbukt Pedersen explains. When employees want to trade in certain financial instruments, they apply via Tradelog. The application and approval process are also handled in the system. Once an employee completes a trade, their account at Euronext Securities Oslo is automatically updated at settlement date to reflect their new holdings. All employees, regardless of their location or employment relationship, use the system. They can even manually register shares, which is necessary for shares in non-Norwegian companies and for employees who don’t have an account with Euronext Securities Oslo. 

TradeLog simplifies compliance tasks

DNB Markets’ Compliance function also uses Tradelog to evaluate employee applications for any potential conflicts of interest before approving a trade, and to follow up on any lock-in period violations. Hanne Leirbukt Pedersen also points to Tradelog’s reporting features as an added benefit for the department. “Tradelog makes it easier for our Compliance team to get an overview of the holdings of a single employee or group of employees, such as our research analysts. It’s also simpler for us to run reports to get an overview of all applications and registrations for a specific time period.”

Remote access benefits employees

The benefits of using Tradelog aren’t limited to the compliance side of DNB Markets’ organisation. “The system was well-received amongst employees,” comments Hanne Leirbukt Pedersen. “That’s primarily because employees feel the new system is simpler and more user-friendly than our previous one.” Tradelog also makes it easier for employees to access information about their own portfolio and trades, and to stay compliant even when they’re away from the office. “In the old solution, employees had to be logged on to DNB’s network in order to submit an application and report trades. In TradeLog, they can do these things from any network, including from a mobile phone. This makes it easier for employees to submit their applications and register trades, even when they’re on holiday or leave,” she explains.

Open collaboration a key success factor

According to Hanne Leirbukt Pedersen, the open dialogue DNB Markets has had with Euronext Securities Oslo about the system has been a contributing factor to the company’s successful system implementation. “Euronext Securities Oslo has improved the system several times during the time we’ve used it, in response to our input on improvements and new functionality. They’re always available and respond quickly if we have any questions or concerns about Tradelog.”

To find out more about Tradelog and other compliance and regulatory services, please contact  //www.euronextvps.no/dnb-markets-uses-tradelog-to-automate-its-employee-trade-monitoring-process/cwiklund@euronext.com ">Carl Johan Wiklund. 

Fact box: About Tradelog 

Tradelog is a web-based compliance tool and case management system offered by Euronext. Companies can use it to handle employees’ applications, approvals and inquiries related to their personal trading activity. It can be tailored to a company’s specific environment and incorporates all of the company’s regulations, internal policies and procedures governing employee trading activity. Read more about Tradelog here.

When the MV Razoni set sail from Odesa with 27,000 mt of corn on 1 August 2022, Ukraine's farmers hailed the reopening of their main export route. Now, with Russia's refusal to renew the Black Sea grain deal, they must rely again on trains, trucks and barges, which initially provided an emergency outlet immediately after Russia's invasion.

The immediate reaction to Russia's statement on 17 July was a surge in wheat and corn futures, with France's MATIF wheat contract trading at Eur237/mt by 11:00 GMT, having closed at Eur232/mt on 15 July, but that price move belied the pragmatic response of Ukrainian grain traders. Ukraine's exporters have been shifting their focus from the Black Sea to the Danube since April as Russia's intentions became clear.

The greater shock to Black Sea grain traders on 17 July resulted from the overnight attack on the bridge across the Kerch Strait, which forced Russia to suspend many of its own grain loading operations.

"Many have lost their hope [in the grain corridor]," a grain broker said about the Ukrainian market. "One medium size crusher in Ukraine who was shipping a Handysize to China via the corridor got a $1 million demurrage and detention bill," the broker added, referring to the costs that many exporters incurred due to time that their chartered ships spent waiting in the queue to enter the Black Sea ports.

The MV Razoni was the first ship to use the so-called grain corridor by which Russia and Ukraine agreed to provide safe passage through the Black Sea for ships carrying grain, foodstuffs and fertilisers. The revival of cross-border traffic by road, rail and river highlighted the shortcoming of the Black Sea Grain Initiative: exporters had to wait weeks for ships to be inspected, and there was a risk of Russia cancelling the agreement.

Not plain sailing

The agreement was signed by Russia, Turkey and Ukraine on 22 July 2022. It had a 120-day term that renewed automatically unless any signatory objected. Russia withdrew briefly prior to the expiry of the first term in November 2022 before renewing the agreement, but in March 2023 the country only gave its consent for a 60-day extension.

The last 60-day term expired on 17 July, with Russia's Ministry of Foreign Affairs citing a failure to reconnect its agricultural bank to the SWIFT system or restore access to its ammonia pipeline, among other issues. Russian President Vladimir Putin had earlier described the deal as "one-way traffic."

Even on 17 July, Putin's spokesman told reporters that Russia would return to the deal if its demands were met. But it's unlikely that Ukraine's grain traders would have confidence in any deal that relies on Russian goodwill. Meanwhile, Russia's wish to resume ammonia exports from the Ukrainian port Pivdennyi seems impossible after the Tolyatti-Odessa pipeline was damaged on 5 June.

One trader of Ukrainian grain, underlining the ways in which Russia had been limiting Ukraine's Black Sea exports without withdrawing from the agreement, said the Russians "find any excuse not to clear a vessel...If you read the huge registration conditions, it's always possible to find a typo or argue that a paper/certificate is missing."

"It's as though you're pledging your vessel as security on a loan and not just checking it for weapons," another trader said, referring to the documentation and inspections process.

Ukraine's three Black Sea ports covered by the agreement shipped more than 20 million mt between October and March, but that flow slowed to a trickle. In the first 10 days of July, it was just 215,000 mt, UN data showed. The slowdown was due to the requirements of the UN-brokered agreement, which stated that every ship had to be inspected before and after it left Ukraine.

The inspection teams included representatives from all the signatories, and Ukraine said Russia's delegates deliberately limited the number of inspections conducted per day.

In March, the inspection teams were checking an average of six ships a day, but by June that had fallen to just two a day, according to the UN. Ukraine's Ministry for Restoration said this was because Russia has refused to register and inspect incoming ships. Average daily exports fell from 124,000 mt in February to 41,000 mt in May. Russia's Ministry of Foreign Affairs did not respond to a request for comment from S&P Global Commodity Insights.

Impatience with Russia's tactics has prompted some traders to call for more radical solutions.

"Our military would need to come up with a plan which does not include goodwill from the Russians," one of them said. "It is long due. ... I think something should be in the works," they added, echoing widespread hope among many of those whose grain export businesses were built around elevators and silos in the Black Sea ports.

Ukrainian President Volodymyr Zelensky said on 18 July that he had written to the UN and Turkey "with a proposal to continue the Black Sea Grain Initiative in a trilateral format – as it is best." The original agreement laid the foundations for insurers to provide cover for ships visiting Ukraine's Black Sea ports. In the absence of a Russian pledge of protection, it could be hard to find cover.

Ukraine's export routes

Ukraine was the world's fourth-largest corn exporter and fifth-largest wheat exporter in marketing year 2021-22 (July to June), with 27 million mt and 19 million mt, respectively. In MY 2023-24, S&P Global expects Ukraine to export 10 million mt of wheat, currently mid-harvest, and 19.5 million mt of corn, which is harvested in autumn.

The crop cycle means that the demand on Ukraine's grain infrastructure is typically highest from August to December. In the two years prior to Russia's invasion, Ukraine exported more than 6 million mt/month for most of that that period.

The Ukrainian Grain Association estimates that at the time of Russia's invasion, Ukraine had around 1,200 inland silos providing storage capacity of around 66 million mt of grains.

The vast majority of that was exported through one of the three Black Sea ports or through Mykolaiv, a nearby river port that was excluded from the Black Sea Grain Initiative due to its proximity to the front line. Ukraine's ports have storage capacity of around 6 million mt, but almost all of that is at the Black Sea ports and Mykolaiv. Those four ports had a maximum potential capacity of 715,000 mt a day, whereas in 2022 the trucks, rail and barges couldn't handle more than 100,000 mt a day.

As the mechanisms of the Black Sea grain agreement have failed, exporters have turned to ports on the Danube. With the wheat harvest coming in, farmers in the Odesa region are sending their grain to the river ports of Reni and Izmail, rather than Odesa, a broker said, adding that they had seen a queue of 1,000 trucks heading in that direction.

This reverse flow represents a contortion of Ukraine's logistics, which evolved to support export hubs on the Black Sea. Exports from the Danube ports of Reni and Izmail were below 500,000 mt a month in 2021, but exporters are now hoping to boost that to 2 million mt.

There were around 30 berths in Izmail, according to one trader, who estimated the same quantity in Reni as well as around 10 in the port of Kiliya, which is farther downstream. In theory, that would mean that 70 coasters of barges could be loading simultaneously at Ukraine's Danube ports, but there are limitations due to the availability of pilots and tugs.

One company looking to the Danube is Kernel Holding, one of Ukraine's largest agribusiness holdings, with terminals in the Black Sea port of Chernomorsk that handled some 8 million mt in 2021.

Kernel is losing $5 million a month as a result of the dysfunction of the Black Sea Grain Initiative, the company's CEO told Bloomberg on 7 July. Ievgen Osypov said Kernel had already lost $57 million and is now using alternative routes. In February, it bought a terminal at the port of Reni.

"The acquisition is part of Kernel's strategy to secure backup options in case the Black Sea ports become inaccessible as a result of the termination of the grain deal," Kernel wrote in its first quarter financial report.

Kernel's investment was backed by USAID, which said in March that Kernel and two other agriholdings companies, Nibulon and Grain Alliance, were making combined investments of $44 million. This would be used to renovate berths at Reni, expand Izmail and acquire a transshipment storage facility in Slovakia.

Nibulon's assets are concentrated in Mykolaiv, the only one of Ukraine's Black Sea ports that wasn't reopened as part of the Black Sea grain deal. The company has spent some $16 million on three loading ports in Izmail with a daily loading capacity of 9,000 mt.

Kernel, Nibulon and the other operators on the Danube have a choice of where to take their grain: they can either load coasters and take parcels of 3,000 mt–12,000 mt direct to customers – mainly in the Eastern Mediterranean – or they can load a series of 1,500 mt barges and take the grain to the Romanian port of Constanta. From there, they can put the grain onto bigger ships for more economical voyages.

The flow of Ukrainian grain down the Danube will put Ukraine's famers in direct competition with Romanians for the use of the 10 available elevators in Constanta, where it costs around $10/mt to unload the grain from a barge into a silo and then transfer it back onto a bigger boat. Some Ukrainian exporters instead opt to bypass the terminals and transfer the grain directly in the port from barges onto Handysize and Panamax ships.

Constanta had surplus capacity before it became a hub for Ukrainian grain, but the country's exemption from EU import tariffs became a sensitive political topic in Bulgaria, Hungary, Poland, Romania and Slovakia, and the countries introduced a ban on imports from 2 May until 15 Sept. The ban still allows onward transit to other member states, and one trader said demand for rail wagons was strong in Italy.

Market conditions shift

In hindsight, the Black Sea Grain Initiative was remarkable: at the same time as Russia was firing missiles at Ukraine's infrastructure, it allowed the country to regain the main route for exports or agricultural commodities, which in the prewar economy represented some 40% of all exports. Whatever Russia's motives, the global pressure for a deal was overwhelming in summer 2022 as the agreement was being negotiated – wheat and corn prices had been at multiyear highs.

On 17 July, Platts assessed 12.5% protein Russian wheat at $229/mt for a 25,000 mt parcel to be shipped from Novorossiisk in the second half of August. That compares with a price of $451/mt on 13 March 2022 for wheat from the Romanian port of Constanta, when the EU was seen as the only reliable source in the Black Sea. The fall in corn prices has been similar.

Ukraine may have balked at the idea that it owes Russia anything, especially the facilitation of ammonia exports from a Ukrainian port. Russia may have inserted terms that it knew Ukraine could never satisfy. Neither side met its formal obligations. United Nations Secretary-General Antonio Guterres described Russia's decision "as a blow to people in need everywhere."

Despite Guterres' appeal, the market impetus for a grain deal between Russia and Ukraine is now far weaker than a year ago. Silos in Brazil are overflowing as the country harvests a record corn crop, and global prices are now lower than they were prior to Russia's invasion of Ukraine. Black Sea wheat prices are also at their lowest levels since 2020, after Russia's bumper wheat crop in 2022 boosted stocks. Meanwhile, Ukraine's grain exporters and their government are developing alternatives that don't require Russia's consent.

Written by William Bland, S&P Commodity insights

This publication is for information purposes only and is not a recommendation to engage in investment activities. This publication is provided “as is” without representation or warranty of any kind. Whilst all reasonable care has been taken to ensure the accuracy of the content, Euronext does not guarantee its accuracy or completeness. Euronext will not be held liable for any loss or damages of any nature ensuing from using, trusting or acting on information provided. No information set out or referred to in this publication shall form the basis of any contract. The creation of rights and obligations in respect of financial products that are traded on the exchanges operated by Euronext’s subsidiaries shall depend solely on the applicable rules of the market operator. All proprietary rights and interest in or connected with this publication shall vest in Euronext. No part of it may be redistributed or reproduced in any form without the prior written permission of Euronext. Euronext refers to Euronext N.V. and its affiliates. Information regarding trademarks and intellectual property rights of Euronext is located at https://www.euronext.com/terms-use.

© 2023, Euronext N.V. - All rights reserved.

How does green finance support ACCIONA’s sustainable strategy?

Currently, the climate emergency poses a major professional challenge to ACCIONA’s activities because, although the projects we develop are aimed at mitigating or adapting to climate change, our activities (such as the creation of wind farms or desalination plants) still produce greenhouse gas emissions. Achieving this decoupling between emissions and the growth of our activity requires a transformation of ACCIONA’s business model to implement, measure and report sustainability initiatives, policies and targets with the same discipline and thoroughness as the Group’s financial performance. As a result, as part of ACCIONA’s Sustainability Master Plan (SMP2025) created in 2021, the financial and sustainability departments of the Group have been integrated into a new Economic, Financial and Sustainability Affairs Department, headed by José Ángel Tejero as Chief Financial & Sustainability Officer (CFSO).

Following this line, ACCIONA’s financing strategy ensures it can provide the most economically efficient solutions while creating a positive impact on the environment and the local communities where it operates, directly contributing to the Sustainable Agenda. In this regard, green finance (bonds and loans) plays a key role in ACCIONA’s funding strategy.

Can you tell us about your experience in issuing green bonds?

Being a pioneer in this practice and taking into account the crucial role that green finance plays in ACCIONA’s sustainable strategy and its significant experience in the field, ACCIONA is recognised as a strong green issuer by its investors. This facilitates the ability of the Group to gather finance and develop its green projects. At the end of the first semester of 2022, 90% of the total amount of Euro Medium Term Notes (EMTNs) issued historically by ACCIONA had been classified as green. 

In relation to ACCIONA Energía, issuing green bond public benchmarks is the norm and thus, 100% of its placements are green Use of Proceeds bonds. It is worth mentioning that all three public transactions have been significantly oversubscribed.

To sum up, it can be said that we have observed that investors value not only the instrument and the specific Use of Proceeds, but also the nature of the issuer. In this regard, both ACCIONA and ACCIONA Energía are well recognised companies among ESG investors, mainly due to the historic and current attractiveness of the projects developed by the Group in economic, social and environmental terms.  

The figures and impacts related to all the green finance instruments issued by ACCIONA can be found in ACCIONA’s Sustainable Finance Report.

How has ACCIONA managed to steer away from greenwashing practices in the green bond market?

One of the primary challenges faced by sustainable finance is to demonstrate effectively its influence in the transformation of the economy. This is directly associated with the risk of greenwashing, where the true environmental impact of investments may be misrepresented. The existing regulations were established during a period when green investments were limited and standards were more lenient. However, as the urgency to invest in sustainable initiatives has grown, along with the expansion of the investment market, the requirements have become more stringent. Practices that were once tolerated are now considered unacceptable or, at the very least, less acceptable in the present context.

We have prioritised the adoption of the European taxonomy of sustainable activities as our central guiding principle since 2020. As a result, our investment requirements have consistently been aligned with its criteria right from the start. In 2022, ACCIONA allocated 98% of its eligible CAPEX to activities that are in line with the taxonomy.

In addition, through ACCIONA’s new Sustainable Impact Financing Framework, the Group has not only committed to create value to the environment through green and sustainable finance instruments but has created a new ‘Dual Impact’ structure. Under this Framework, ACCIONA may issue four types of sustainable financing instruments: two types of traditional financing instruments (Green Use of Proceeds and Sustainability-Linked financings) and those two same instruments enhanced with a Local Impact feature. The add-on Local Impact feature entails a commitment on the part of the issuer to invest in a particular Local Impact initiative.

This pioneering approach to green and sustainable finance is completely impact-oriented and strives to create additional value, primarily to local communities. The Sustainable Impact Financing Framework already includes some of the Local Impact Components defined, as well as the calibration methodologies used to establish the Local Impact targets. In addition, the Framework clearly states that failure to meet the Local Impact target will trigger a financial penalty directed at funding the delivery of the positive impact via a qualified third-party, ensuring that the local impact is ultimately carried out.

How is ACCIONA preparing for the evolving disclosure expectation and regulation requirements on ESG-related data? How do you see the evolution of the sustainable debt market?

In line with the first question, ACCIONA is elevating its non-financial reporting to the next level, aiming to reach the same levels of thoroughness and exhaustiveness as for the financial information. In order to achieve this, ACCIONA is increasing the number of indicators disclosed in the Sustainability Report 2022 that are being externally reviewed under reasonable assurance rather than on limited assurance, as this greater level of assurance increases the data reliability and robustness.

Additionally, to anticipate the needs of our investors and stakeholders, ACCIONA will be publishing its mandatory Principal Adverse Impacts table under the regulation of the Sustainable Finance Disclosure Regulation (SFDR) on its corporate website.

Regarding the sustainable debt market, ACCIONA feels that there is a need to increase transparency in order to avoid greenwashing and give confidence to its stakeholders, especially investors. To fill this information gap, in the previous exercise ACCIONA included new information on the Sustainable Finance Report 2022 to help investors track their investments, going one step beyond business as usual. Besides illustrating the consolidated impact of its portfolio and the total annual figures registered in relation with green and sustainable financing, ACCIONA has included in the report the allocation and impact information for all the different instruments issued individually. In this way, investors can track their contribution directly and see with their own eyes the impact that they are having on the planet and on the communities.

What is the role of EthiFinance in the European rating ecosystem?

EthiFinance is a pioneer pan-European double materiality agency with a specific expertise in Small and Mid Caps. Established in France in 2004, EthiFinance has been analysing European SMEs, both financial and non-financial aspects, ever since.

EthiFinance has grown organically and through acquisitions, in particular the Spanish credit rating agency Axesor Ratings last year and the German ESG rating agency imug rating in March 2023. Our coverage is pan-European and will soon be extended to the biggest European corporations.

EthiFinance positions itself at the junction of two critical agendas for the EU economy:

1. the Green Deal, on the one side
2. the Capital Markets Union (CMU), on the other.

In effect, as President of the European Central Bank Christine Lagarde said in 2021 at a high-level conference on the launch of the Corporate Sustainability Reporting Directive (CSRD), the greening of the economy should accelerate CMU, progress towards which has not met stakeholders’ expectations thus far. From this standpoint, even if we are still small, it is not lost on us that we are an actor in European sovereignty.

At EthiFinance, our approximately 160 employees are all conscious of how high the stakes are in this context and we commit to playing our role. The clock is ticking and we plan to progress further to reach a critical mass by 2025, when CSRD kicks in.

Within the European rating ecosystem, what distinguishes us is our ability to service the SME segment efficiently and to put into operation, faithfully and in the long term, the double materiality concept that is the cornerstone of the EU’s comprehensive legislative sustainable finance regulatory framework.

Europe, with the UK and the EU in particular, is working on the regulation of ESG rating providers. We believe this is a very important and positive development, that will inject long-needed trust in the market. EthiFinance is committed to a balanced, proportionate and demanding regulation in this regard because we are aware that poor ESG rating practices can feed greenwashing, which must be checked.

We see ourselves as the nucleus, or the platform, from which a leading European rating agency will emerge. A rating agency that embraces and protects Europe’s distinctive patterns and connects individual European companies of all sizes to the global financial markets. From this standpoint, the very successful trajectory of Euronext is a great source of inspiration for us.

Is ESG performance also becoming important for SMEs? How are you supporting SMEs in this regard?

• Firstly, ESG performance is an important driver of the business resilience of any corporate. Companies that perform well at ESG are indeed better prepared to anticipate and respond to ESG-related risks and opportunities, via innovation or market positioning. They have long-term strategic thinking, making them more agile in adapting their business model. Additionally, ESG performance has also become an important asset to attract and retain talent.
• Secondly, ESG performance is increasingly becoming a key asset to attract funding, whether in debt or equity. As credit conditions tighten further, investors’ and banks’ capital will be allocated in priority to corporates that are best in class in ESG. ESG performance enables issuers to continue to attract a diverse investor base and in turn, it could even become a condition to access capital. 

EthiFinance supports its clients both in structuring their ESG roadmap and leveraging on their ESG strategy to raise capital. 

What could be the implications for SMEs of the upcoming ESG reporting requirements?

The requirements of the Corporate Sustainability Reporting Directive (CSRD) will help SMEs structure their CSR roadmap, boost their ESG ambitions and ensure they have identified and mitigated all relevant risks. Obviously, complying with the upcoming requirements is not a simple task and it is very important for SMEs to prepare themselves. They have a few years ahead of them to get ready, understand the requirements and start building the data. In the end, the risk of not being able to comply goes beyond financial sanctions – it is really the visibility of corporates towards investors that is at stake. 

EthiFinance has developed methodologies and tools to equip its clients and help them build their CSRD roadmap as well as structure their sustainability report. 

Sustainability-linked bonds have become a systematic option for corporate issuers: how can we be sure that indicators are material and targets are ambitious?

The materiality of the KPIs chosen and the level of ambition of the targets are crucial components of the credibility of Sustainability-linked instruments, and in turn of the reputation of the issuer. The International Capital Markets Association’s (ICMA) Sustainability-linked Bond Principles provide interesting and useful guidelines to frame the selection of the KPIs and calibration of the Sustainability Performance Targets (SPTs). ICMA has also built a registry of 300 potential KPIs that could be applicable to SLBs, depending on their sector.  

As Second-Party Opinion (SPO) providers, our role is to challenge the issuer on the selection of its KPIs: are they relevant, core, and material to its overall business? And just as importantly, we challenge the issuer on the calibration of its targets: is the set trajectory ambitious, going beyond business as usual, and is there a robust action plan to support the ambitious targets? 

EthiFinance’s expertise in this field stems from close to 20 years of CSR advisory (our consultant team for corporate is CSR-native), in-depth knowledge of sustainable finance regulation and consultancy activities for investors. 

As 2022 has drawn to a close, plans for this year’s round of annual general meetings (AGMs) are already underway. With pandemic restrictions an ever-fading memory, will companies embrace the familiarity of in-person AGMs, or will the versatility of virtual general meetings (VGMs) prevail? Our experts weigh in on the trends and developments that will shape the coming AGM season.

In 2022, about half of the AGMs Euronext Securities Copenhagen facilitated for its clients were either completely virtual or hybrid meetings. According to Marianne Benedict, Head of Issuer Services at Euronext Securities Copenhagen, format decisions for the upcoming AGM season are most likely to be driven by business needs and culture, rather than the pandemic-related concerns that have influenced the previous three years’ AGM seasons. “Some of our clients have strong traditions connected with their AGMs, and they clearly prefer physical meetings,” Marianne explains. “Then we have the other end of the spectrum, where companies have invested heavily in a virtual solution, even creating in-house broadcast studios, and for them VGMs are clearly the way forward.”

Legislative changes make voting by proxy easier

One legislative development that will impact 2023 general meetings is the bill for changes to the Danish Companies Act, passed by the Danish Parliament in May 2022. The bill makes it easier for foreign investors to cast votes at AGMs for Danish companies. Investors can now nominate a representative to exercise their shareholder rights simply by providing explicit authorisation and instruction, rather than having to present a power of attorney. Flemming Merring, Senior Product Manager at Euronext Securities Copenhagen, explains how this change might impact VGMs. “Until now more than one third of the pre-cast votes have been rejected due to lack of a power of attorney. The change has eliminated that issue and in almost all general meetings, we expect a significant increase in the participating capital and votes.”

Dedicated contact person ensures a smooth GM process

Whether companies elect a virtual, physical or hybrid solution, Marianne Benedict, Head of Issuer Services, says Euronext Securities Copenhagen is well-positioned to help them with every step of the process. “We offer a one-stop-shop solution with a single point of contact throughout the entire AGM or VGM process, from planning to execution.”



This hands-on approach is particularly useful for hybrid and virtual meetings. “With virtual and hybrid formats, having the right technology and support in place are critical success factors,” Marianne Benedict, Head of Issuer Services says. “Our VGM system is developed here in Denmark and supports secure shareholder attendance and access. Attendees can exercise shareholder rights to participate, interact and vote in both hybrid and fully virtual meeting formats.” Over the past two years, Euronext Securities Copenhagen has facilitated more than 100 VGMs each year using this system.

Proven technology creates a virtual experience clients can trust

The combination of a fully tried and tested system together with a dedicated support person helps give companies peace of mind. “Our clients often comment about the concerns they had going into hosting a VGM – particularly around technical issues and possible transmission delays – and how these concerns proved to be unfounded. We’re with them every step of the way, and the technology we use is stable and reliable. So, whether they choose to go virtual, stay physical or take a hybrid approach, we can help them host a successful event for their shareholders,” Marianne concludes.



To get started on planning your 2023 AGM, contact us at:  CPH-Investor@euronext.com