Machine Translated by Google Diário da República, 1st series — No. 62 — March 28, 2007 1773 ASSEMBLY OF THE REPUBLIC of ongoing privatizations, make a relevant contribution to increasing the competitiveness of the national economy. Resolution of the Assembly of the Republic no 13/2007 However, this statement is strengthened if one becomes aware that some of the companies owned or participated in Election of an alternate member for the delegation of the Assembly of the Republic to the by the State are, through their visibility and importance, Euro-Mediterranean Parliamentary Assembly paradigms in domains of organization and behavior. The Assembly of the Republic resolves, under the terms Furthermore, many State companies — including public of paragraph 5 of article 166 of the Constitution and article business entities, commercial companies wholly owned by 2 of Resolution of the Assembly of the Republic no 58/2004, the State and subsidiaries — play a leading role in sectors of 6 August, to elect for the Euro-Mediterranean in which services of general interest are provided, on which Parliamentary Assembly the following congressperson: the good depends. -being of citizens. Furthermore, some of these companies develop or operate infrastructures whose Substitute — Renato Luís Pereira Leal (PS). efficiency and effectiveness depend on the competitiveness of many business economic units located upstream and Approved on March 15, 2007. downstream of those others. The President of the Assembly of the Republic, Jaime Gama. It is important to note that the State business sector (SEE) does not only incorporate large companies, but also Resolution of the Assembly of the Republic no 14/2007 many small or medium-sized companies. Notwithstanding Election of five personalities to the National Council this, the SEE's economic and social role is of the utmost for Medically Assisted Procreation importance, both when considering its global dimension and when considering its geographic and sectoral sphere The Assembly of the Republic resolves, under the terms of action. of Article 166(5) of the Constitution and Article 31(2 ) (a) of For all these reasons, it becomes clear how important it Law No. 32/2006, of 26 July, to appoint Medically Assisted is for the companies that make up the SEE to have the following personalities: governance models that not only achieve high levels of performance but, together with the good examples that Effective: exist in the private business sphere, contribute to the dissemination of good practices in this area, including the Maria Leonor de Sá Barreiros da Silva Parreira. adoption of concerted sustainability strategies in the Salvador Massano Cardoso. economic, social and environmental fields. And, in this Sergio Manuel Madeira Jorge Castedo. domain, even if this does not result directly from the Carlos Calhaz Jorge. applicable legislation, the State must set an example, Eurico José Marques dos Reis. following the best international practices. Today, therefore, there are no doubts about the Substitutes: importance of companies being managed by correct Domingos Manuel Pinto Henrique. practices and aiming at the appropriate objectives. Likewise, Carlos Manuel deAndrade Miranda. it is clear that companies must assume social responsibilities, namely, in terms of equal opportunities, and have Approved on March 15, 2007. environmentally sound practices that are consistent with the sustainability of growth and economic development. The President of the Assembly of the Republic, Jaime There is also no doubt that, for this to happen, it is necessary Gama. to establish mechanisms for taking decisions, disseminating information and supervising those decisions that are capable of inducing an efficient use of available resources, for the exclusive benefit of the purposes for which companies PRESIDENCY of the COUNCIL of MINISTERS have been created and are maintained. In other words, it is now clear that good corporate governance has a Resolution of the Council of Ministers no . 49/2007 The fundamental economic and social value, both for the companies themselves and for the economies in which they public business sector continues to represent an operate. It is also known that good governance is not only important part of national economic activity. achieved by enshrining in the law the most appropriate Despite the privatizations and reprivatizations that have models and legal structures, there are ethical and taken place since 1989, with a view to restructuring the behavioral domains that are essential for companies to be State's business sector and reducing the State's weight in managed in the effective interest of their shareholders and the economy, the State's direct and indirect business other stakeholders . and pursue the objectives for which interests still cover a very large number of high number of they were created and are maintained. For this reason, public companies and commercial companies. In addition, codes of good corporate governance are more and more some of the largest national companies are fully state- frequent, which aim only to encourage the various economic owned. agents to contribute to ensuring that companies are It should also be noted that the portfolio of State holdings efficiently governed and act with equity in the face of the includes relevant equity positions in some of the largest different interests that gravitate in its orbit. In the 25 member Portuguese companies listed on the stock exchange. states of the European Union, around 80 codes of good governance have been published since the beginning These are, in themselves, sufficient reasons to say that the state business sector can and must, due to its size and extent, and without prejudice to Machine Translated by Google 1774 Diário da República, 1st series — No. 62 — March 28, 2007 the 1990s. The Organization for Economic Cooperation and principles to each company is preceded by a judgment of Development (OECD) itself value on its suitability in terms of its published in 1999 and updated in 2004 a set size and other characteristics. Although, of recommendatory principles on the governance of the basic principle of complying is also enshrined companies. In Portugal, the Market Commission for or explain, according to which companies that do not Securities (CMVM) published in 1999 and successively comply with these recommendatory principles updated in 2001, 2003 and 2005 recommendations must justify the reasons why this happens. addressed to listed companies. Recently, This resolution also enshrines new principles in the also civil society, through the Portuguese Institute with regard to the provision of information by public of Corporate Governance, commented on the governance companies to citizens and taxpayers, who are after all practices of Portuguese companies and issued the the ultimate holders of residual property rights your code of good governance. There are, therefore, of these companies. In this sense, a wide range of set of information that will have to be disclosed multiple references to good practices that national companies have at your service. through the website of State companies, However, with regard to the performance of the State to be made available in aggregate by the Directorate-General for as a shareholder, and of companies owned or participated Treasury and Finance for this specific purpose, without in by the State, there are few reflections aimed at prejudice to the information made available on the systematize and disseminate good government practices. THE companies' websites. This information also includes, OECD published in 2005 a text with this aim namely, an analysis of sustainability in the «OECD guidelines on corporate governance of state- economic, social and environmental domains, in which the -owned enterprises». In this document, that organization company will account for its strategy, goals achieved seeks to extend its principles of good governance and action plans for the future. Furthermore, it is devoted a principle of disclosure of information about facts public companies and the behavior of the State that may materially affect the economic, financial or equity in its relationship with these companies. situation of the companies. The document attached to this resolution is part of Public disclosure of this information will not only allow in this context of promoting good governance practices that citizens, taxpayers and other stakeholders business and aims to continue the Government Program, are more informed about the situation of companies in which the objective was to improve the owned by the State, as it will also serve so that, corporate governance of state companies and, on the other hand, in a plural society, there is greater scrutiny of public opinion catalyst effect, the widespread adoption of good corporate on the governance structures and performance of these governance practices. companies. However, improving corporate governance practices So: from the outset, to improve the practices of the State Pursuant to Article 37(2) of the at the level of the various bodies acting on its behalf Decree-Law No. 71/2007, of 27 March, and under the terms and at the level of the different titles by which it is related of Article 199( g) of the Constitution, the Council with companies. Hence, a first set of of Ministers resolves: principles are addressed to the State itself as 1 — Approve the principles of good governance of the shareholder and as a related party to those companies in the state business sector listed companies, whether as a customer, supplier, collector of of the annex to this resolution and which forms part of it taxes or responsible for the defense of the public interest integral. enshrined in labor, environmental or 2 — Entrust the Minister of Finance to promote another nature. The different government bodies an annual global assessment of the degree of compliance or the Public Administration that at any time of the principles approved by this resolution, whose who exercise this type of function should therefore, conclusions should be included in the annual report on the desirably, take as a reference the principles and situation of the state business sector. recommendations set out in this resolution. Presidency of the Council of Ministers, 1 February Still within the framework of the principles, the State must 2007. — The Prime Minister, José Sócrates Carvalho periodically analyze the degree of compliance with the Souza's chick. obligations and responsibilities that are incumbent upon them. ATTACHMENT public companies, taking into account the qualitative and quantitative parameters, prices or their form of Principles of good corporate governance fixing and any compensatory allowances. of the state business sector The State cannot, and should not, relate to the I — Principles addressed to the State public companies in the same way that it relates with the companies in which it only participates. In this i) As a holder of shares in the capital of companies In the latter case, the State must act using the instruments 1 — The exercise of the State's supervisory power and that are legally within its reach, combining the pursuit of the shareholder function must be transparent, for which reason they must public interest with respect for other shareholders and other Government members must be clearly identified stakeholders. and, when applicable, the services and bodies of the Public Hence, for this universe of companies, this resolution only Administration that carry it out and must be subject to takes advantage of the relative principles of public disclosure the fundamental acts in which to the performance of the State as a shareholder, do not these functions materialize. none of the good practices enshrined here are specifically 2 — The State must establish the strategic guidelines addressed. and objectives that must be pursued by the The situation is, however, different with regard to the companies of which it directly owns the total domain companies wholly owned by the state. to these and participate in an informed and active way in the assemblies Companies and the holders of their management and of the companies in which it has a stake, contributing to the supervisory bodies are addressed by the principles set out establishment of strategic guidelines and in Chapter II. Note that the application of such of the objectives of these companies. The guidelines set Machine Translated by Google Diário da República, 1st series — No. 62 — March 28, 2007 1775 must be transmitted by companies to their subsidiaries, 10 — Every year, each company must inform the namely when there is total ownership. members of the Government and, when applicable, Furthermore, the State must contribute to establishing the services and bodies of the Public Administration the principles of social responsibility and sustainable that exercise supervisory power or the shareholder development that must be respected by companies, function, and the public in general, of the way in which as well as annually evaluating, in depth and rigor, the its mission was carried out, the degree of fulfillment of degree of compliance with these strategies, objectives its objectives, the way in which the policy of social and principles. responsibility, sustainable development and the terms 3 — The State must exercise its supervisory power of the public service were complied with and in which or its shareholder rights in order to ensure that terms its competitiveness was safeguarded, namely companies have adequate inspection, control and through research, development, innovation and the evaluation mechanisms, that act independently from integration of new technologies in the production process. the executive managers and any shareholders and 11 — Companies owned by the State must comply that they give guarantee that the economic and with the legislation and regulations in force. Its behavior financial information provided is accurate and must, in particular, be ethically irreproachable with accurately portrays the company's situation. regard to the application of rules of a fiscal nature, Furthermore, the State must ensure that, when money laundering, competition, consumer protection, admitted to trading on a regulated market, the environmental and labor standards, in particular those companies in which it participates comply with relating to non-discrimination and the promotion of nationally and internationally accepted best corporate governanceequality practices. between men and women. 4 — The State must help the minority shareholders of the companies in which it participates to exercise 12 — State-owned companies must treat their their rights and see their interests respected, namely workers with respect and integrity, actively contributing by ensuring that the corporate governance bodies of to their professional development. the companies adequately reflect the shareholder structure. 13 — State-owned companies must treat all their customers and suppliers and other holders of legitimate ii) As a related party (stakeholder) interests fairly, namely company employees, other creditors who are not suppliers or, in general, any 5 — As a customer and supplier of companies in entity that has some type of right about the company. which it holds all or part of the capital, the State must In this context, companies must establish and publicize act in accordance with market conditions and criteria, the procedures adopted for the acquisition of goods comply in a timely manner with all obligations assumed and services and adopt award criteria guided by and exercise its rights with rigor and fullness. principles of economy and effectiveness that ensure 6 — Public Administration services and bodies, the efficiency of transactions carried out and equal irrespective of the nature of their attributions, must act opportunities for all interested parties qualified to the vis-à-vis State companies in the same way as they act effect. Annually, State-owned companies must disclose vis-à-vis private companies. all transactions that have not taken place under market conditions, as well as a list of suppliers representing II — Principles addressed to companies owned by the State more than 5% of total external supplies and services, i) Mission, objectives and general principles of action if this percentage corresponds to more than 1 million euros. 7 — State-owned companies must fulfill the mission and objectives assigned to them, in an economically, financially, socially and environmentally efficient 14 — The business of companies owned by the manner, taking into account demanding quality State must be conducted with integrity and must be parameters, seeking to safeguard and expand their properly formalized and confidential or undocumented competitiveness, with respect for the principles of expenses cannot be incurred. Each company must social responsibility, sustainable development, public have or adhere to a code of ethics that includes service and meeting the needs of the community that demanding ethical and deontological behavior, have been established. Furthermore, each company disseminating it to all its employees, customers, directly controlled by the State must set out and suppliers and the general public. publicize its mission, objectives and policies, for itself and for the subsidiaries it controls. ii) Management and inspection structures 8 — State-owned companies must prepare activity 15 — The management and supervisory bodies of plans and budgets appropriate to the resources and companies owned by the State must be adjusted to sources of financing available, taking into account the the size and complexity of each company, in order to fulfillment of the missions and objectives that these ensure the effectiveness of the decision-making companies have been entrusted with, as well as process and to guarantee an effective supervisory defining sustainability strategies in the economic capacity. The number of members of the management domains , social and environmental, identifying, for body must be adequate for each case, and must not this purpose, the objectives to be achieved and exceed the number of members of identical bodies in explaining the respective planning, execution and control instruments. comparable private companies, of similar size and in 9 — Companies owned by the State must adopt the same sector of activity. equality plans, after a diagnosis of the situation, aimed 16 — State-owned companies must have a at achieving in companies an effective equality of governance model that ensures the effective treatment and opportunities between men and women, segregation of executive management and supervisory functions. eliminating discrimination and allowing the reconciliation Larger and more complex companies should specialize of personal life , family and professional. the supervisory function by creating Machine Translated by Google 1776 Diário da República, 1st series — No. 62 — March 28, 2007 of specialized commissions, among which one should to materially affect the economic, financial or patrimonial include an audit committee or a committee to situation of these companies, or their conditions for providing financial matters according to the governance model a public service, acting in a manner adopted. identical to that established for the provision 17 — The non-executive members of the management of this type of information to shareholders by the bodies, the members of the general and supervisory board companies admitted to trading on a regulated market, or, when these do not exist, the members of the body except when the public interest or the supervisory bodies must annually issue a report companies impose its non-disclosure, particularly in the assessment of the individual performance of executive case of strategic or confidential information, commercial or managers, as well as an overall assessment of the structures industrial secrets or in the protection of personal data. and the governance mechanisms in place in the company. 18 — The accounts of companies held by the State of greater dimension or complexity must be audited vi) Adjustment to the size and specificity of each company annually by independent entities. the audit must observe standards identical to those practiced 24 — Public companies which, by virtue of their for companies admitted to trading on the market dimension or its specificity, are not in a position to comply regulated. The non-executive members of the bodies with any of the principles previously of directors, the members of the general and statements, or by virtue of the public interest or supervision or, when these do not exist, the members legitimate business interests should not do so, of the supervisory body must be the interlocutors should explain the reasons why this occurs and outline of the company with the external auditors, and it is up to them to alternative good governance measures that have proceed with its selection, its confirmation, its contracting been implemented. and, as well, the approval of eventual services outside the audit function, which should only be III — Principles relating to the disclosure of information granted if the independence is not jeopardized of these auditors. 25 — All information that, pursuant to the present 19 — The management body must create and maintain principles of good governance, must be disclosed a control system appropriate to the size and complexity of to the public must be available through a website the company, in order to protect the company's investments on the Internet ("Site for State Enterprises"), to create and its assets. Such a system must by the Directorate-General for the Treasury and Finance, without cover all relevant risks assumed by the prejudice to the provisions of the legislation applicable to companies company. integrated into the State's business sector and publicity on 20 — State-owned companies must promote rotation the company's own website or and term limitation of members remission to this one. That site must also include, of its supervisory bodies. namely, historical financial information and current status of each company, the identity and elements iii) Remuneration and other rights curricula of all members of its bodies social. 21 — Public companies must publicly disclose, under 26 — The website of State companies must provide the terms of the applicable legislation, the total, variable clear, relevant and up-to-date information on and fixed remuneration earned, whatever the the life of the company, including in particular the public its nature, each year, by each member of the body service obligations to which it is subject, the terms management, distinguishing between executive functions contracts for the provision of public service, the model and non-executive, as well as the remuneration received underlying financing and financial support by each member of the supervisory body. With the received from the State in the last three years. same periodicity, all the 27 — Access to all available information other benefits and perks, namely with regard to on the website of State companies must be free and free. health insurance, use of a vehicle and other benefits granted 28 — Public companies must nominate, when by the company. justified, a customer provider, free access and free of charge, with which the right can be exercised iv) Prevention of conflicts of interest complaints from customers and citizens in general, 22 — The members of the corporate bodies of companies as well as the presentation of suggestions, working public authorities must refrain from intervening in decisions that as a link between the company and the public in involve their own interests, in particular general. in approving expenses incurred by them. Furthermore, 29 — Public companies must include in their at the beginning of each term, and whenever justified, management reports a point related to the governance of such members must declare to the management body companies which include, in particular, the internal and and the supervisory body, as well as the General Inspectorate external regulations to which the company is of Finance, any equity interests subject, information about relevant transactions with that they hold in the company, as well as relevant related entities and the remuneration of members relationships they maintain with their suppliers, customers, of the governing bodies, as well as a sustainability analysis financial institutions or any other and, in general, an assessment of the degree of other business partners, likely to generate conflicts of compliance with these principles of good governance. interest. v) Disclosure of relevant information Resolution of the Council of Ministers No. 50/2007 23 — The governing bodies of public companies must One of the central objectives of the National Strategy immediately publicly disclose all information for Energy, approved by the Council Resolution of which they are aware that they are likely to of Ministers no 169/2005, of 24 October, is the