New bill helps transparency in firms’ finances

The government is preparing a bill that will make it easier to set up new companies and increase transparency in corporate accounting, Deputy Development Minister Yiannis Papathanassiou told participants at the «Money Show» conference yesterday. The bill will also reform bankruptcy procedures, allowing companies to continue to operate under such status. Papathanassiou called on businesspeople to submit their proposals on the bill. Evangelos Perakis, Commercial Law professor at the University of Athens, told participants that Greece is very low on the scale of countries effectively enforcing the rights of shareholders. This, said Perakis, partly explains the longstanding reluctance of foreign companies to invest in Greece. Yiannis Karayiannis, managing director of electronics retailer Germanos, said that Greek companies should not welcome excessive bureaucracy in order to fend off potential foreign competitors. He said that his own company, forced to provide a far more detailed picture of its finances by new International Financial Reporting Standards (IFRS), found that the extra disclosure actually attracted foreign investors eager to buy its shares. What the state can do, he said, besides cutting red tape, is to become more active in its international economic relations policy through the network of embassies and consulates abroad. Participants agreed that the introduction of IFRS helped to provide a clearer picture of Greek companies, but not always to their advantage. They mentioned the example of five insurance firms whose capital stood at a total of 548.5 million euros under Greek accounting standards and shrank to 39.3 million under IFRS.