Brief
The reference code of corporate governance is issued by the Budapest Stock Exchange, and was updated in November 2012. The latest version marks a step backward in board independence by exempting the management board from independence requirements.
Members of all types of boards (management board, board of directors, and supervisory board) are elected by the general meeting. The management board is not only composed of executives, but also of non-executive members.
According to issuers’ statements in corporate governance reports, Hungary seems to be a say-on-pay market, although it is not. Even if remuneration of all corporate officers is approved by the general meeting, it concerns only directors’ fees due to board members in title of their corporate office, but does not include the remuneration to be paid to executives as part of their service contract. Currently, a vote on executive remuneration (binding or advisory) is not required.
