Chair of the French financial markets authority (AMF)

Listed companies have been using the “Financial Communication: Framework and Practices” guide to assist them in their financial communication practices for several years now. The guide has become an essential resource for Investor Relations professionals, as well as for other financial communication stakeholders such as agencies and advisory firms.

It provides companies with an overview of the most recent developments, particularly with regard to non-financial information and how they tie in with existing requirements in the areas of financial information, ongoing information and managing inside information.

The rising importance of non-financial communication is a key development, particularly in Europe.

Given the urgent need to tackle climate change, companies and financial market players are now required to produce and publish a wide range of environmental, social and governance (ESG) information. These new disclosure requirements are the result of the gradual but rapid entry into force of a new body of international, and above all European, regulations whose complexity represents a big challenge for those required to implement them. Undoubtedly, Europe has taken a significant lead in this area, and regulatory fragmentation is therefore a real risk. This is particularly critical for issuers, who are having to contend with contradictory and redundant requirements.

In this environment and as part of its "Impact 2027" strategic guidelines for 2023-2037, the French financial markets authority (Autorité des marchés financiers – AMF) aims to promote more sustainable finance. Since 2018, the AMF has made sustainable finance one of its top priorities, supplementing its "Supervision2022" strategic plan with a dedicated roadmap, highlighting the regulator's role in supporting and supervising market players (issuers, fund managers and distributors). These measures have enabled the AMF and the Paris market to take the lead in this area, meeting the high expectations of investors and society as a whole.The AMF's continued involvement in this field is therefore self-evident.

Since 2018, a set of European regulations was added to the regulatory framework that the AMF is responsible for enforcing. This hugely ambitious addition is a welcome one, as sustainable finance needs to be pursued at a European, if not international, level. But due to the complexity of this area, the standards and regulations are not always coherent, and implementing them is a challenge for the stakeholders concerned.

In response to this situation, the AMF has defined two main priorities: (i) be a driving force behind the completion of the regulatory framework, and (ii) help companies and financial players correctly apply these rules, without, of course, excluding more coercive action to combat greenwashing. Maintaining the trust of savers – who are showing a growing interest in sustainable finance – in the new regulatory framework is key.

In terms of regulations, the aim is to contribute to a coherent set of quality rules.This applies at European level, but also in terms of interoperability between the international standards produced by the ISSB (International Sustainability Standards Board) and the European ESRS (European Sustainability Reporting Standards).

The regulator also has an important role to play in supporting and encouraging the development of best practice. Expanding regulations have led to the development of new, highly technical concepts on climate change and, more broadly, ESG issues, for a growing number of players.

The AMF aims to guide financial players and issuers as they implement the ambitious new European regulations for a more sustainable economy and finance.

New developments are highlighted in red.

Financial information is subject to thorough and often complex regulations which primarily distinguish between (i) “periodic information”, (ii) “ongoing information” and (iii) “regulatory information”, to which (iv) specific transaction-related information can be added.

“Mid-cap” issuers (i.e., compartment B and C issuers on Euronext and Euronext Growth) may refer (i) to the AMF Policy Handbook for Mid-Caps, published in November 2016, which outlines the main rules governing financial reporting and disclosures, and (ii) to the guide published by the AMF on October 23, 2017 for SMEs and mid-tier firms, which provides an overview of the main market regulations and their applicable corporate law. This practical guide, which is organised by topic and listed market, covers in particular the procedures and deadlines for publishing financial information, the type of information to disclose and corporate governance-related rules(1). 

In order to ensure perfectly equal access to information for shareholders, when communicating inside information to a third party(11) who is not bound by a confidentiality undertaking, the issuer must assure effective and complete dissemination either simultaneously, in the case of intentional communication, or as quickly as possible, in the case of unintentional communication (the issuer will, for example, be required to publicly disseminate such information in the case that confidential information is communicated to an analyst during a one-on-one meeting or during a roadshow). Issuers with websites that have information spaces reserved for members of their shareholders’ clubs need to be especially careful in this regard.

In addition, with the same concern for equal access, the information disseminated must be accessible to all investors simultaneously in order to avoid creating an unfair distribution of information which favours certain investors to the detriment of others(12).

Accordingly, if an issuer or any of its subsidiaries are listed in a foreign country, the information must be disseminated simultaneously in France and the foreign country. It should be noted that the principle must be applied both for the dissemination by a press release and for the notification or the filing of documentation with foreign authorities (for example, the 6K report in the USA).

Issuers are also recommended to disclose financial information outside of market trading hours in order to permit all investors to assimilate the information before the beginning of trading to avoid turbulent changes in the issuer’s share price. In that respect, even if the French legal transposition of the directive on financial instruments markets (the MiFID) put an end to the requirement to concentrate market transactions on the regulated markets and welcomed alternative means of executing transactions, the majority of share transactions for French issuers listed on Euronext Paris remains on Euronext Paris. Under those conditions, the opening and closing hours for trading securities on Euronext Paris will continue to provide the appropriate reference for the publication of information by companies listed on Euronext Paris.

In the case of a multi-listing, it is recommended that issuers adapt their dissemination procedures to avoid disclosing significant new events while the market is still open.

The standard practice for French companies is nevertheless to base themselves on the trading hours of Euronext Paris. They do however retain the right to use another stock exchange’s hours as a reference.

Finally, in order to respect the principle of equal access to information for all shareholders, in the case that an issuer holds a significant stake in another listed company, it is essential that the communication calendars of the issuer and that company are coordinated.

According to the principle of consistency, the communication of information must be considered by the issuer in light of prior communication practices in order to avoid misleading investors.

Specifically, the issuer must maintain the same treatment regarding the communication of information likely to impact its share price either upwards or downwards.

In applying the principle of consistency, the issuer must also ensure the coherence of all information disseminated, regardless of the date, format or recipient of the information. In particular, financial information disseminated through the written press must be consistent with information disseminated by electronic means. This requirement for consistency implies the implementation by the issuer of a pre-dissemination control process and the centralisation of information disseminated. In accordance with the principle of consistency, if the issuer chooses to disclose indicators in addition to those based directly on its financial statements (i.e., alternative performance measures) or business segment information, such information must be consistent over time. Any changes that reflect changes in the issuer’s strategic focuses must be explained in all of the communication materials used(13).

Information provided to the public by issuers must be accurate, true and fair(14). These requirements apply as much to regulatory disclosures as to information disclosed on a voluntary basis. The information must be accurate, true and fair at the date of its dissemination.

Information provided to the public by the issuer must be accurate, which means without errors, but also true and fair, which means that the issuer must communicate, in a way that leaves no room for ambiguity, all of the details related to the event which is the subject of the communication to the market so that the market can evaluate the impact of the event and the outlook for the issuer. This requirement is linked to the requirement that information be complete: what distinguishes true information from accurate information is that accurate information may not be true if the issuer has omitted certain information which could have changed the perception of its situation by the market(15). However, the provision of inaccurate information alone does not in itself constitute misconduct(16). In accordance with articles 12 and 15 of the Market Abuse Regulation, which provide a basis for penalising deficiencies in the quality of information disclosed to the public, two additional elements are required in order to constitute misconduct: (i) the disputed information gives, or is likely to give, false or misleading signals as to the supply of, or demand for, or price of, a financial instrument, or fixes, or is likely to fix, the price of one or several financial instruments at an abnormal or artificial level, and (ii) the knowledge, whether proven or presumed, of the false or misleading nature of the disclosure.

Information disclosed by the issuer must be fair. The fairness of the information provided implies that both the positive and negative components related to the information under consideration are communicated. This is also linked to the principle of consistency described above.

For periodic information or for specific circumstances within which regulations require disclosure, the driver of the disclosure requirement is based upon one or several objective criteria which require no judgement on the part of the issuer. The issuer must promptly publish an annual financial report with respect to each financial year (periodic information) or publish a prospectus when its securities are offered to the public or admitted to trading on a regulated market, unless exempted from doing so.

On the other hand, for ongoing information, it is the responsibility of the issuer to determine whether or not this information should be disclosed to the public in accordance with the principles contained in the Market Abuse Regulation. Consequently, the AMF recommends that issuers devise internal procedures to assess whether or not a given piece of information constitutes inside information(17).

Article 7 of the Market Abuse Regulation defines inside information as information of a precise nature, which has not been made public, relating, directly or indirectly, to one or more issuers or to one or more financial instruments, and which, if it were made public, would be likely to have a significant effect on the price of those financial instruments or on the price of related derivative financial instruments, meaning information that a reasonable investor would be likely to use as part of the basis of his or her investment decisions.

Information shall be deemed to be of a precise nature if it indicates a set of circumstances which exists or which may reasonably be expected to come into existence, or an event which has occurred or which may reasonably be expected to occur, where it is specific enough to enable a conclusion to be drawn as to the possible effect of that set of circumstances or event on the prices of the financial instruments or the related derivative financial instruments, the related spot commodity contracts, or the auctioned products based on the emission allowances. These circumstances or events may be of a financial, strategic, technical, organisational or legal nature. The AMF Enforcement Committee recently reiterated that, in the case of a proposed takeover, “the precise nature of information on a proposed public offering is established when the plan is sufficiently well-defined between the parties to have a reasonable chance of success” (AMF Enforcement Committee, August 3, 2021, SAN-2021-15, Safran/Zodiac). In the aforementioned decision, the AMF also emphasises that an intermediate stage in a process or transaction spread over time may in itself be considered inside information, in line with Daimler case law (CJEU, June 28, 2012, Markus Gelt v. Daimler AG, Case. C-19/11), now incorporated in Article 7 of the Market Abuse Regulation.

The Court of Justice of the European Union in its judgement of March 11, 2015 (C-628/13) also specified that information could be considered as being true even if the direction of a change in the price of the financial instruments concerned could not be determined with a sufficient degree of probability. Taken literally, this decision gave the obligation to disclose ongoing financial information a significantly broader scope. In the same judgement, the Court of Justice reaffirmed that the definition of inside information is the same regardless of whether there is an obligation to disclose information or an obligation to refrain from trading (insider dealing).

The AMF has reiterated the best practices to adopt in the event of doubt as to whether information held by a listed company is inside information, for example when the company is experiencing a number of disruptions to its operations.

In such situations, and to ensure equal access to accurate information for investors, the AMF encourages issuers to disclose, as soon as possible, the information in question. Such a disclosure should be accompanied by details of the measures being taken to address the disruptions, and regular updates regarding the progress of these remedial measures should be provided.

The AMF has also reiterated the importance not only of providing investors with accurate information but also of the measures that issuers must implement to ensure that their employees do not disclose or use for personal gain any information of which they become aware during the course of their duties. One way in which issuers can prevent insider trading(18) is by training all of their employees.

The AMF has published a practical Guide to filing regulatory information with the AMF and to its dissemination, which was updated on December 6, 2021.

The issuer must ensure the complete and effective dissemination of all relevant regulatory information, with the exception of disclosures related to the crossing of thresholds which are handled by the AMF itself(31).

Regulatory information must be disseminated using electronic means in accordance with the principles defined by the AMF General Regulations requiring dissemination to as wide a public as possible, within as short a timeframe as possible and using methods which ensure the integrity of the information. In order to achieve this, issuers may, at their own discretion, choose to disseminate regulatory information themselves or decide to use the services of one of the primary information providers registered on a list published by the AMF, in which case it is assumed that they have met their effective and complete dissemination obligation(32).

To ensure easier access to information, the AMF also recommends that issuers indicate on social networks that their financial statements can be found on their website under a specific section visible from the homepage or on a “Finance” or “Investors” page. The issuer’s statutory financial statements and its subsidiaries’ financial statements should be clearly identified as such(33).

Issuers are also required to file their regulatory information with the AMF in electronic format via the ONDE extranet site at the same time as the information is publicly disseminated, unless the issuer uses a primary information provider registered on a list published by the AMF, in which case the primary information provider will directly file it with the AMF. Issuers are no longer required to issue financial communications in the written press(34). The AMF nevertheless recommends that such communication be issued according to a timetable that the issuers consider appropriate for the type of securities issued, their shareholder base and their size (AMF Position/Recommendation no. 2016-05, section 19.5, updated on April 29, 2021).

Issuers whose securities are admitted – or subject to a request for admission – to trading on Euronext Growth must also ensure the complete and effective dissemination of all regulatory information according to the same rules as issuers listed on Euronext Paris(35). The same applies for issuers whose securities are admitted – or are subject to a request for admission – to trading on Euronext Access. It should be noted that the AMF Enforcement Committee deems that disclosing information about a draft resolution in a notice of meeting published in the BALO does not mean that the information has been brought to the attention of the public(36).

Issuers are required to post their regulatory information on their website as soon as it is disseminated(39).

Under the terms of article 17.1 of the Market Abuse Regulation, issuers are required to post and maintain on their website, for a period of at least five years, all inside information they are required to disclose publicly.

The documents listed below must be available for a period of ten years:

• ■annual financial reports;
• ■half-yearly financial reports;
• ■reports on payments to governments(40).

ESMA’s Questions and Answers of October 22, 2015 relating to the Transparency Directive specify that reports that were made publicly available less than five years before November 26, 2015 must remain publicly available for ten years (as from the date the reports were originally published).

The AMF also recommends that companies store regulatory information that is sensitive, but that does not constitute inside information and was not included in their annual and half-yearly financial reports, for a sufficient length of time.

In addition, the DILA (Direction de l’information légale et administrative – French office of legal and administrative information) provides for the centralised storage and archiving of regulatory information on its website www.info-financiere.fr for a period of ten years. In line with the financial transparency objective, the European Commission plans to create a European Single Access Point (ESAP) for listed companies' financial and non-financial data. Draft Regulation no. 2021/0378 (COD) has had its first reading in Parliament and is one of the European institutions' legislative priorities for 2023 and 2024 (Joint Declaration 2023-2024, published on February 17, 2023).

The Transparency Directive (Directive 2013/50/EU), supplemented by Commission Delegated Regulation (EU) 2016/1437, provides for a centralised archive storage facility at EU level (the European Electronic Access Point), the objective of which is to facilitate both access to financial information and the comparability of companies’ financial statements. A Commission Delegated Regulation establishes a European Single Electronic Format(41).

The IFRS consolidated financial statements contained in these reports – and in particular the primary financial statements: balance sheet, income statement and cash flow statement – must be marked up using XBRL tags for financial years beginning on or after January 1, 2021. The notes to the financial statements for financial years beginning on or after January 1, 2022 must be marked up using block XBRL tags.

Access to regulatory information is set out in Commission Delegated Regulation (EU) 2016/1437 of May 19, 2016.

The growing internationalisation of the financial markets with an increasingly wide geographical shareholder base, the listing of several issuers on several markets (multiple listings) and the increase in cross-border transactions are all contributing factors to the greater importance placed on the linguistic treatment of documents containing information disclosed by issuers.

The need to translate these documents may be a significant constraint for an issuer or slow their access to foreign financial markets. At the same time, in order to ensure that investors are well informed, it is necessary that information disseminated by an issuer on a foreign financial market be available in a language which is understandable to the investors concerned.

In order to promote the movement of capital within the European Union and the European Economic Area while guaranteeing that investors are properly informed, EU law has harmonised the rules governing the language of the various documents published by issuers.

The principles laid down within the EU – often expressed in a complex manner – have been transposed by the AMF within its General Regulations.

New developments are highlighted in red.

The financial communication calendar is governed by regulatory disclosure deadlines (detailed below) and is also determined by the ability of a company’s information systems to provide data that are accurate, true and fair within the applicable timeframe.

Beyond the legal requirements, the AMF has issued recommendations on the disclosure of quarterly financial information and the disclosure of annual revenue figures(1).

Example of a financial communication calendar based on deadlines for a reporting year ending December 31

The AMF recommends that issuers define and publish their provisional financial communication calendar, specifying the dates of their periodic disclosures and the reasons for choosing these dates, in their annual report and on their website, in a clearly identified section. To comply with good practices, this calendar should also be published in a press release.

If one or more of the dates initially disclosed are changed, companies should determine whether a press release is required (for the specific case of a change in the dividend payment date, see Section 2.6.4 – “Dividends”).

In any case, the communication calendar is to be updated each year(2).

Disclosures of periodic information are major events in the financial communication of an issuer. Through these disclosures, the listed company publishes, through various means, a large amount of information regarding its strategy, markets and financial and non-financial performance as well as the impact of this information on the financial statements and the company’s life. Analyses performed by market participants on the issuer are mainly based upon this information. Therefore, for analyses to be as relevant as possible, it is essential for a listed company to assist these participants in their analysis and the understanding of its business model.

To this end, entities whose securities are admitted to trading on a regulated market must set up a specialised committee responsible for monitoring the preparation of financial information. In practice, this is the audit committee.

The AMF published a Guide to periodic disclosures by listed companies(3), which takes up the main financial reporting obligations applicable to issuers listed on the Euronext Paris market and includes a section on Euronext Growth and Euronext Access.

The disclosure by the issuer of qualitative forward-looking information to the market is required:

• ■in the management report prepared for the shareholders' meeting pursuant to articles L. 233-26 and L. 232-1 II of the French Commercial Code (article L. 233-26: “The Group management report describes [...] foreseeable developments [for the group comprising all the companies included in the scope of consolidation]”; article L. 232-1 II: “The management report describes [...] the foreseeable developments [for the company]”;
• ■in the URD, pursuant to Commission Delegated Regulation 2019/980 of March 14, 2019:
  • -pursuant to Item 18.7 of Annex 1 of Delegated Regulation 2019/980, the issuer is required to “describe any significant change in the financial position of the group which has occurred since the end of the last financial period for which either audited financial statements or interim financial information have been published, or provide an appropriate negative statement”; and
  • -pursuant to Item 10.1 of Annex 1 of Delegated Regulation 2019/980, the issuer is required to provide a “description of (a) the most significant recent trends in production, sales and inventory, and costs and selling prices since the end of the last financial year to the date of the registration document, (b) any significant change in the financial performance of the group since the end of the last financial period for which financial information has been published to the date of the registration document, or provide an appropriate negative statement”;
  • -pursuant to Item 10.2 of Annex 1 of Delegated Regulation 2019/980, the issuer is required to communicate “information on any known trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on the issuer’s prospects for at least the current financial year”.

In some cases, qualitative forward-looking information disclosed by an issuer can be requalified by the AMF as a profit forecast (see below).

Information regarding a company’s sales, production, research and development and, to a certain extent, employment-related issues, constitute, along with more strategic announcements (acquisitions or divestitures), the “newsflow” of an issuer, aimed at illustrating the implementation of its strategy and image. 

The issuer must always make sure that the events it decides to communicate are material, in order to avoid saturating market participants by delivering them an excess of information without any mention of its relative importance.

Thus, information of a commercial or technical nature, of local or specific interest (related to a sector or technology), which does not achieve a certain threshold of materiality (see below), need not be the subject of an effective, complete publication (because it does not qualify as regulatory information), and can just be made available on the issuer’s website.

When an event related to a company’s business occurs, the issuer therefore assesses whether it should be disclosed to the market depending on whether the event is material or not and on the potential impact it may have on the share price of the issuer. The issuer can base its decision on the following criteria:

• ■the expected consequences on financial performance (revenue, margins, costs incurred);
• ■the impact on the balance sheet structure (net debt, shareholders’ equity);
• ■the estimated impact on the competitive position (gain or loss of market share, technological advances conferring a competitive edge, etc.) of the strategy (expansion into a new geographical area, diversification of the business, etc.);
• ■the estimated labour-related consequences (recruitment, organisational restructuring, etc.), especially on the geographical area concerned (country, region, etc.);
• ■the business sector of the issuer (e.g., the significance of patents for issuers in the pharmaceutical and cosmetic industries, the significance of large contracts within the oil industry, etc.).

The provisions of Directive 2013/34/EU establishing the “comply or explain” principle have been transposed into article L. 22-10-10-4°, of the French Commercial Code. The corporate governance report must specify “when a company refers voluntarily to a code of corporate governance drawn up by organisations representing companies, the provisions that have been ruled out and the reason for this decision, as well as the place where the code can be consulted, or, in the event that the company does not refer to a code, the reasons why it has decided not to do so as well as, where appropriate, any rules adopted in addition to those required by law”.

This information must be sufficiently clear, true and complete. It must cover (i) recommendations effectively applied (including how they were applied as well as disclosure on their website) and (ii) recommendations that are not applied (including how, why and what measures have been taken to achieve the underlying objectives of the relevant recommendation).

The two main corporate governance codes to which issuers currently refer are the AFEP-MEDEF Code, for listed companies (as revised in December 2022 and applicable to reporting periods beginning on or after January 1, 2023), and the Middlenext Code, for SMEs (as revised on September 12, 2021).

The January 2020 version of the AFEP-MEDEF Code and the AMF recommend that issuers disclose all recommendations that they do not apply, and the reasons for not doing so, in a specific section or table in the URD or annual report(109).

Each year, the AMF publishes a report on practices observed and issues recommendations in terms of required disclosures regarding governance and executive compensation (for example, see the AMF 2021 and 2022 Reports on corporate governance and executive compensation in listed companies). It is important to note that, since June 2018, the AFEP-MEDEF Code has enhanced the enforcement powers of the High Committee on Corporate Governance, giving it the ability to “name and shame”. Consequently, if a company fails to respond within two months of receiving a letter from the High Committee asking it to justify its non-compliance with the Code’s recommendations, it runs the risk of the content of the letter being made public(110). 

According to article 223-16 of the AMF General Regulations, every month, issuers are required to send to the AMF and publicly disclose the total number of shares and voting rights making up the share capital if those figures differ from the information previously disclosed (a sample press release is shown in appendix 12 of the Guide to filing regulatory information with the AMF and to its dissemination, updated in December 2021).

Information on the number of shares and voting rights making up issuers’ share capital is not published on the AMF’s website. It is published by issuers within the scope of their regulated information. Consequently, issuers must ensure that the information is disclosed effectively and in full, and is posted on their own website.

Pursuant to article L. 233-7 of the French Commercial Code, any individual or legal entity, acting alone or in concert, holding directly or indirectly a number of shares that crosses a legal disclosure threshold (i.e., 5%, 10%, 15%, 20%, 25%, 30%, one-third, 50%, two-thirds, 90% or 95% of the issuer’s share capital or voting rights), whether upwards or downwards, must notify the issuer no later than the fourth trading day after the shareholding threshold has been crossed.

Article 223-14 of the AMF General Regulations requires these persons to also notify the AMF, no later than the close of trading on the fourth trading day after the shareholding threshold has been crossed. Disclosures on threshold crossings are considered regulatory information and full and effective disclosure of such information is now exceptionally provided by the AMF itself on its website(160).

The automatic granting of double voting rights has been in effect since April 2, 2016 (unless stipulated otherwise in the articles of association) for all fully paid shares that can be proven to have been held in the same name for at least two years. Consequently, shareholders should be particularly attentive to crossing these thresholds. The AMF publishes this information on its website once it has received the form for disclosing the threshold crossing. A model disclosure form is also available on the AMF website. Order no. 2015-1576 of December 3, 2015 amended the scope of disclosures made in respect of crossing thresholds.

• ■article L. 233-7 I of the French Commercial Code now states that shares included in the calculation of shareholding thresholds may be owned “directly or indirectly”;
• ■the scope of financial instruments excluded from the calculation has been enlarged. In addition to shares, this now also includes agreements and financial instruments listed in article L. 233-7 and article L. 233-9 I of the French Commercial Code that meet certain criteria (acquired for the sole purpose of clearing, held by custodians, held in the trading portfolio of an investment services provider, acquired for the purpose of stabilisation, etc.);
• ■agreements and financial instruments giving rise to a physical or cash settlement (article L. 233‐9 I 4° bis of the French Commercial Code) and options that are exercisable immediately or in the future, are now included in the shares and voting rights used to calculate crossings of thresholds that must be disclosed. Clearly, only instruments giving long positions need to be included. However the AMF recently considered that a double assimilation was needed when physical calls were acquired by a party and physical puts sold by the same party, even though the characteristics of the situation make it impossible to truly acquire the shares underlying the calls and puts (a clause nullifying the calls or puts, respectively, in the event that these puts or calls are exercised);
• ■the acquisition of securities as part of a buyback programme or a financial instrument stabilisation programme represents another exemption from disclosures of upward or downward crossings of thresholds established by the company’s articles of association and of legal thresholds and temporary sale agreements, provided that the attached voting rights are not exercised or used for purposes other than to intervene in the management of the issuer (article L. 233-7, IV of the French Commercial Code).

Lastly, pursuant to article 223-15-1 of the AMF General Regulations, disclosure requirements when crossing statutory and legal thresholds also apply to organised multilateral trading facilities when a single person owns over 50% or 95% of a company’s capital or voting rights. In such cases, not only the AMF but the issuing company as well, must be informed that these thresholds have been crossed.

As a result, according to the regulation, the notice of threshold crossing indicates in particular the crossed threshold, the total number of shares and voting rights held, and the name of the shareholder who has crossed the threshold.

The shareholder who has crossed the threshold must also specify:

• ■the number of shares that the shareholder owns that give deferred rights to newly issued shares and the corresponding voting rights;
• ■existing shares that the shareholder may obtain, by way of an agreement or a financial instrument that requires physical or cash settlement, not including those that have already been counted in the calculation to determine the crossing of the threshold.

The notice of threshold crossing must also (i) disclose whether the shareholder is acting alone or in concert with others and, (ii) in the event of crossing the thresholds of 10%, 15%, 20% or 25% of share capital or voting rights, state the objectives for the next six months in a declaration of intent.

The declaration of intent should be sent to the issuing company and be received by the AMF by the end of the fifth trading day following the threshold crossing. It must specify the objectives to be pursued in the coming six months, the methods of financing the acquisition, whether the acquirer is acting alone or in concert, whether the acquirer is planning to stop or continue purchasing and to acquire control or not, the planned strategy in relation to the issuer and the transactions to implement this strategy, the acquirer’s intent as to the settlement of the agreements and instruments mentioned in points 4° and 4° bis of section I of article L. 233-9 of the French Commercial Code, if the acquirer is a party to such agreements or instruments as well as any temporary sale agreement concerning the shares or voting rights.

This declaration will also specify whether the acquirer plans to request appointment for him/herself or for one or more persons as a director, member of the executive board or the supervisory board. In the event of a change in intent within six months, a new declaration must be immediately sent to the company and the AMF and brought to the public’s attention, thus marking the start of a new six-month period.

In principle, the issuer discloses the composition of and any changes to its shareholder structure within the framework of its periodic information on publication of its URD.

As an exception, when the shareholder structure has been modified following a transaction to which the issuer is a party, the issuer may consider it necessary to disclose the information to the market immediately, because of the material nature of the change.

The issuer’s press release should be published either when the definitive agreement that will result in a change in the shareholder structure is reached, or prior to reaching a definitive agreement when it becomes obvious that the confidentiality of the change in the shareholder structure can no longer be assured.

In the absence of a material change in the shareholding structure, an issuer who wishes to disclose to the market any change in shareholder structure is completely free to make such a disclosure.

If the issuer believes that an immediate disclosure is necessary or timely, the press release published by the issuer may describe the transaction that led to the change in the shareholding structure and provide the breakdown of share capital following the transaction, the company’s main commitments and, if appropriate, the company’s position relative to this change in shareholder structure.

A shareholder who has crossed a threshold established by the company’s articles of association is required to declare this breach to the issuer within the time limit set in the articles of association. This information is for internal purposes only and the AMF does not have to be notified.

Pursuant to article L. 233-11 of the French Commercial Code, clauses regarding shareholders’ agreements (and any agreement more generally) setting out preferential terms for the disposal or acquisition of shares admitted to trading on a regulated market and concerning at least 0.5% of the issuer’s share capital and voting rights, must be sent by the agreement’s signatories to the issuer concerned and to the AMF. The AMF will then publicly disclose the information(162) within five trading days of the signature of the agreement in question.

However, the issuer is under no obligation to inform the market of the signature or termination of a shareholders’ agreement of which it is the subject. In principle, the issuer provides disclosures concerning shareholders’ agreements within the framework of its periodic information (URD).

The issuer and the AMF must also be informed of the date on which the shareholders’ agreement expires.

When the issuer signs a shareholders’ agreement concerning one of its listed subsidiaries or an investment in a listed company, or when such an agreement is terminated or expires, market disclosure is mandatory if the agreement sets preferential conditions for the disposal or acquisition of shares concerning at least 0.5% of both the share capital and voting rights of the subsidiary or the listed investment concerned. The shareholders’ agreement must then, under the terms of the regulation, be sent to the AMF, which will issue a notice accordingly within five trading days of the agreement’s signature.

If the agreement does not concern a listed company or if it concerns a listed company but does not set preferential conditions for the disposal or acquisition of shares covering at least 0.5% of both share capital and voting rights, the issuer will evaluate whether market disclosure is necessary or timely depending on the situation, by examining the materiality of the shareholders’ agreement, notably with regard to the major strategic interest of the subsidiary for the issuer, the number of shares covered by the shareholders’ agreement, and the rights conferred to the issuer and/or any other parties to the agreement.

If the issuer believes that market disclosure is necessary or timely, the press release should be published immediately by the issuer, as soon as the agreement is signed, expires or is terminated.

The press release published by the issuer must identify the parties to the agreement, the number of shares concerned by the agreement and the term of the agreement. The press release should also describe the main rights and obligations that the signatories will derive from the agreement, as well as the results of its termination (end of the potential concerted action, etc.).

In the course of its business, the issuer may be exposed to various types of risks. Schematically, it is possible to distinguish between the issuer's own risks that are specific to it and are related to internal factors (for example, the risk of default of one of its clients, risks related to inappropriate supplier practices, risks linked to a significant event concerning a listed or non-listed subsidiary of the issuer, or the risk of default of a counterparty in market transactions), risks related to external factors, particularly macroeconomic factors, that may have an impact on its business and/or its results (for example, market risks including currency risk, interest rate risk, liquidity risk or commodity-related risk), risks related to changes in regulation applicable to the issuer or modification of tax law, or country risks that may have an impact on the issuer's production, product distribution or supplies. 

Risks related to sustainability issues,  also  known as sustainability risks, are considered both risks specific to the issuer and external risks.

In its Guide for compiling universal registration documents, the AMF sets out its recommendations for drafting the “Risk factors” section(177).

Other provisions concerning the presentation of risk factors in the URD are included in Delegated Regulation (EU) 2019/980 of March 14, 2019. Lastly, on March 29, 2019(178) ESMA published its final report in which it specifies the information that should be provided, including aspects concerning the number of categories of risk factors and their materiality as well as its guidelines on October 1, 2019(179).

The AMF reminds investors that non-financial risks, or sustainability risks, should be included in the "risk factors" section when they meet the criteria set out in the Prospectus Regulation. Therefore, risks that are specific to the issuer and/or the securities and that are material for making informed investment decisions should be described in the risk factors section. Other risks required by the regulations (especially the NFIS), which do not have these characteristics, can be presented in other parts of the URD.

With regard to climate risks, a distinction is generally made between two main types of risk(180):

• ■"physical" risks, i.e., those associated with the physical impacts of climate change. Physical risks are financial losses attributable to the increased frequency and severity of extreme weather events (storms, floods or droughts) and the chronic impacts of climate change (ocean acidification, rising sea levels or changes in rainfall);
• ■"transition” risks, i.e., those linked to the transformation of the economy towards carbon neutrality. The main causes of transition risks include unforeseen changes in public policy, standards and technology, as well as changing consumer and investor preferences, with potential impacts on reputation. Governance and investor risks (divestment, difficulty in attracting long-term investors, undervaluation, etc.) would fall into the "transition" risks category.

The AMF emphasises the importance of ensuring that financial and non-financial information is consistent.

As a general principle, issuers should not comment on rumours concerning them, regardless of their source (market traders, media, internet forums on the market, etc.). As an exception, in the event of a persistent unfounded rumour which the issuer finds to be causing a significant disturbance in the price and/or trading volumes for its shares, it is up to the issuer to assess whether a press release denying the rumour should be published.

If the rumour has a basis in truth, the matter very likely concerns leaked information, which should be treated as such (see below, "Leaked information").

The specific case of a rumour or leaked information relative to a takeover bid on the issuer is discussed in the section devoted to takeover bids.

See Section 3.4.6 – “Financial and digital communication” for further details on using social media to manage rumours.

If the issuer is in negotiations with a third party concerning an acquisition or disposal, it must judge whether disclosure to the market as soon as possible is necessary or timely, depending on the situation, with regard to whether the transaction is material (the materiality of the transaction being assessed particularly in consideration of the criteria discussed in Section 2.9.1.2 - “Signature of a firm agreement”). The criterion to be considered is whether or not inside information exists and, in particular, whether it is sufficiently precise. It should be noted in this respect that an intermediate step in a process or a transaction spread over time may in itself be considered inside information. In a recent case, the AMF Enforcement Committee found that the bid (as opposed to the offer itself) was sufficiently accurate as soon as discussions with the banks were initiated, without waiting for contact to be made with the selling counterparty or the financing required for the acquisition to be obtained(183).

If the information is considered inside information, the issuer may decide to apply the rules relating to delayed disclosure of inside information. If the conditions for delaying the disclosure of information are no longer met, in particular if it is no longer able to guarantee the confidentiality of the information, it must publish it as soon as possible.

If the transaction is not material, the issuer’s disclosure of the existence of negotiations is optional and may be made at its complete discretion.

If the issuer considers immediate market disclosure to be necessary or timely, the issuer’s release will indicate in practice the purpose of the negotiations, the state of advancement of the negotiations and the partner’s name.

In the event of the signing of a pre-contractual document (memorandum of understanding, letter of intent, etc.), the issuer’s communication may, in certain cases, contain a summary of the key provisions of the agreement as well as possible future steps or conditions precedent that should be fulfilled prior to the conclusion of a firm agreement or implementation of the transaction when the issuer judges that market disclosure of this information is necessary or timely.

AMF Position/Recommendation no. 2016-08 (Section 3.2) sets out the procedures for disclosing inside information prior to the sale of significant stakes in companies listed on a regulated market (“data room” procedures)(184). The AMF recommends that data room procedures only give access to inside information if strictly necessary for the purpose of informing participants about the transaction concerned, and that access to the data room be restricted to signatories of a letter of intent stating their intention to carry out a financial transaction and the viability of the project, and particularly their ability to finance it.

Before initiating any data room procedure, each of the participants must sign a confidentiality agreement aimed at preventing the dissemination and use of inside information. When information exchanged in a data room becomes inside information, the issuer must either make it public or delay disclosure in accordance with the requirements set out by the Market Abuse Regulation (see Section 1.5 – “Requirement for market disclosure of 'inside information'”). In order to reiterate the principle of equal access to information in the course of a financial transaction, the AMF also expects issuers to publish all inside information provided between the future investor(s) and the company in the prospectus or the offer document. This disclosure does not release the issuer from its responsibility to publish inside information in accordance with article 17.1 of the Market Abuse Regulation. The AMF stipulates that in the event that a data room is organised in the course of a public offering and, if there are several competing bids, the issuer needs to ensure access for all of the competitors to the information contained in the data room and enter into a confidentiality agreement with each one. Lastly, the AMF recommends that issuers only set up a data room that leads or is likely to lead to the transfer of inside information in the context of major transactions only.

In a decision by the Enforcement Committee, the opening of a data room was deemed to be a contextual element that led, along with other factors, to the information being established as inside information linked to a major financial transaction(185).

Upon the issuer’s signing of a firm agreement concerning an acquisition or disposal transaction, the issuer shall judge whether immediate market disclosure is necessary or timely with regard to the material nature represented by the acquisition or disposal for the issuer(186). It can also decide to delay releasing the information as long as the required conditions are met (see Section 1.5 – “Requirement for market disclosure of 'inside information'”).

The material nature of the disposal or acquisition, depending on the case, should be assessed in particular with regard to the size of the acquisition, its estimated impact on the issuer’s business, results and financial structure, the strategic, financial, commercial and/or industrial importance of the transaction for the issuer and the capital gain or loss realised by the issuer in the event of a disposal.

If the transaction is not of material importance for the issuer, market disclosure may nonetheless be made if announcement of the acquisition would correspond to an expectation on the part of the market.

Market disclosure is carried out in the form of a press release. In certain cases, the issuer will also organise a meeting for analysts or a press conference relative to the transaction.

In practice, the press release published by the issuer generally includes a description of the target (businesses, financial results and outlook) and strategic, financial, commercial and/or industrial objectives pursued by the issuer in the framework of the acquisition or disposal, as appropriate. The press release also outlines any pending conditions precedent to the completion of the transaction (regulatory and competitive authorisations, etc.) and provides a provisional timetable for the transaction (a sample press release is shown in appendix 3 of the Guide to filing regulatory information with the AMF and to its dissemination).

Concerning an acquisition, the press release published by the issuer generally indicates the purchase price if it is material and may, if the issuer judges it useful, indicate the means of financing planned for the transaction.

If appropriate, the press release may also indicate the accounting impact of the transaction, anticipated synergies, the advantages of changing or leaving in place the target company’s management and a description of the specific risks presented by the target (such as environmental or social risks, etc.).

Concerning a disposal, the press release published by the issuer generally indicates the estimated capital gain or loss if it is material; however, this information may be provided qualitatively instead of being quantified. It is also useful to note that, in certain cases, for specific accounting reasons related to the asset divested, this information may not be disclosed to the market if it is likely to mislead the public.

However, in practice issuers rarely disclose to the market a description of the context of the transaction or disclose the existence of agreements or related transactions (such as management contracts, commercial contracts, etc.).

In practice, issuers generally issue a disclosure to the market when an acquisition or disposal of material importance, and about which they have previously communicated, is completed, particularly if the market had been informed that the circumstances of the transaction carried the risk of it not being completed.

In addition, the acquisition or disposal will result in a change in the issuer’s consolidation scope that may require providing pro forma information within its periodic information (see Section 2.2.5.3 – “Changes in the consolidation scope of the issuer [publication of pro forma information]”).

When conditions precedent (authorisation by the relevant competition authorities, regulatory authorisations, etc.) relating to a disposal or acquisition about which the issuer has previously communicated are fulfilled, the issuer will assess the necessity or timeliness of disclosing this information to the market with regard to the material importance of these conditions precedent in carrying out the transaction.

In the event of non-fulfilment of a condition precedent relating to a disposal or acquisition about which the issuer has previously communicated, immediate market disclosure is necessary if such non-fulfilment of the condition precedent definitively prevents the transaction from being carried out.

In the event that negotiations are broken off, immediate disclosure to the market is necessary if the market was previously informed that negotiations were in progress; in the opposite case, a disclosure of the information to the market would not appear desirable, except in specific cases(187).

If the issuer discloses the break-off in negotiations, the press release published by the issuer will recall the purpose of the negotiations. In practice, it is rare for the press release to indicate the exact reasons for breaking off negotiations.

Since June 2015, the AMF has recommended that each company whose securities are authorised to trade on a regulated market should consult the shareholders’ meeting prior to transferring – in one or several operations – or entering into a promise or an option to sell, assets representing at least half of its total assets on average over the two preceding financial years. Consultation of shareholders is also recommended when at least two out of five financial ratios defined by the AMF in its Position/Recommendation no. 2015-05 reach or exceed half of the consolidated benchmark indication for this ratio, calculated over the two preceding financial years (e.g., sales generated by the assets or business transferred, divided by consolidated sales, or the asset sale price divided by the group’s market capitalisation). If the company decided not to apply the ratios indicated previously, it must justify its choice and indicate the alternative criteria selected and justify their relevance.

The AFEP-MEDEF Code, as revised in December 2022, states that in the event of an unfavourable vote at the shareholders’ meeting, the board must immediately publish a press release on the company’s website setting out how it intends to proceed with regard to the operation.

Moreover, if these transfers or acquisitions are part of the normal business activity of companies whose main activity is acquiring and managing investments, such companies must still explain – in a well-reasoned manner adapted to their specific situation – why they consider that it is in the company’s interest to dispense with this consultation.

The AMF and the AFEP-MEDEF Code also recommend that executives inform the shareholders and the market of:

• ■all transfers and acquisitions of significant assets not necessarily determined by the aforementioned ratios;
• ■the context and negotiations regarding the sale or disposal agreement;
• ■strategic, economic and financial circumstances and motives that led the transfer process to be considered and then carried out;
• ■the successive stages in the lead-up to the operation launched by the company’s governing bodies in the company’s interest.

In the case of asset transfers, details must also be given of the quantitative and qualitative criteria used to select the successful bid and, if applicable, how the competing bids were analysed and rejected, subject to confidentiality restrictions. For acquisitions of significant assets, details must be provided of the methods of financing the operation.

They constitute an offer of securities to the public pursuant to Regulation (EU) 2017/1129 of June 14, 2017, applicable owing to the reference made by article L. 411-1 of the French Monetary and Financial Code:

• ■a communication to individuals or legal entities, of sufficient information on the terms and conditions of the offer and on the securities concerned in order to enable an investor to decide to purchase or subscribe for the securities;
• ■the placement of securities by financial intermediaries.

A certain number of waivers and exemptions from this regime are provided for in articles 1 and 3 of Regulation (EU) 2017/1129, articles L. 411-2 and L. 411-2-1 of the French Monetary and Financial Code, and article 211-2 of the AMF General Regulations.

In accordance with Regulation (EU) 2017/1129, in 2019 the European Commission adopted two delegated regulations that supplement the applicable regulation as regards:

• ■the format, content, scrutiny and approval of prospectuses (Delegated Regulation (EU) 2019/980 of March 14, 2019);
• ■key financial information which must be included in the summary, the publication and classification of prospectuses, advertisements, supplements to a prospectus, the publication and the notification portal (Delegated Regulation (EU) 2019/979 of March 14, 2019).

In March 2021, ESMA published Guidelines on disclosure requirements under the Prospectus Regulation(198), which intend to help issuers comply with the disclosure requirements set out in Commission Delegated Regulation (EU) 2019/980 supplementing the Prospectus Regulation. The Guidelines relate to the presentation of issuers and securities, the subject of the prospectus.

The Guide to preparing the prospectus and the information to be provided for public offerings or admission to trading of securities, covers all the applicable regulations in force and AMF and ESMA guidance(199).

An offer of securities to the public generally requires the publication of a document (the prospectus) intended for the public that describes the content and the terms and conditions of the transaction concerned, as well as the organisation, the financial position and changes in the issuer’s business activity and any underwriters of the securities concerned by the transaction. This document is drafted in French or, in the cases set forth in the AMF's General Regulations, in another language commonly used by the financial community. In principle, it includes a summary and, where applicable, must be accompanied by a translation into French of the summary.

Regulation (EU) 2017/1129 of June 14, 2017, which entered into force on July 21, 2019, particularly aims to streamline this summary, stipulating that it must now be no longer than seven sides of A4-sized paper and can be extended by three additional sides of A4-sized paper to identifiably substitute content of key information documents of the PRIIPs regulation(200). The summary must contain a maximum of 15 risk factors and include those “specific” to the issuer, securities and, where applicable, the guarantor, as well as those “of most relevance” for sound investor decision-making.

The risk factors must also be presented in a selective manner in the prospectus in accordance with PD3, one of the objectives of which was to end the exhaustive reporting of risk factors that enabled issuers to limit their responsibility. Risk factors must therefore be:

• ■limited to those risks which are specific to the issuer and/or the securities and which are important for investment decision-making;
• ■ranked according to their probability of occurrence and the expected magnitude of their negative impact;
• ■presented in a limited number of categories depending on their nature.

Additionally, ESMA has published 12 guidelines to assist national authorities (including the AMF) in relation to the inclusion of risk factors in issuers’ prospectuses(201). According to these guidelines:

• ■the disclosure must establish a clear and direct link between the risk factor and the issuer or securities;
• ■the disclosure must clearly convey the materiality of a risk factor and its potential impact; the most material risk factors must be presented first within their respective risk factor category, but it is not mandatory for the remaining risk factors within each category to be ranked in order of their materiality;
• ■presentation of the risk factors must be focused and concise;
• ■the AMF must check the consistency of all information included in the prospectus (the materiality and specific nature of risk factors);
• ■it must ensure that the risk factors are presented under different categories depending on their nature;
• ■the AMF must also ensure that, when the prospectus includes a summary, the presentation of the risk factors in the summary and the prospectus are consistent.

ESMA aims to ensure that there are no more than ten categories and sub-categories in the prospectus. The total number of risk factors included in the summary shall not exceed 15 (article 7, paragraph 10 of the Prospectus Regulation). The issuer must therefore pay attention to the diverging requirements of (i) no more than 15 risk factors in the summary, and (ii) no more than ten categories and sub-categories of risk factors in the body of the prospectus.

It also specified that only those risks that are specific to the issuer and/or the securities and that are important for making investment decisions should be included in the prospectus. Specifying risks in this way results in the “personalisation” of risks at the level of the issuer(202).

Regulation (EU) 2017/1129 also provides that issuers whose securities have been admitted to trading on a regulated market for at least the last 18 months benefit from a simplified disclosure regime (focusing on relevant information) for any secondary issuances of securities fungible with existing securities that have previously been issued, or non-equity securities.

It should be noted that PD3 also established a URD, with effect from July 21, 2019, drawing on the French universal registration document (document d’enregistrement universel – DEU) concept. It provides the market with comprehensive annual information and enables businesses to benefit from a faster approval process (five days) if they include the document in a prospectus. The document, which is drafted by issuers whose securities are admitted to trading on a regulated market or a multilateral trading facility, must describe the issuer’s organisation, business, financial position, earnings and outlook, and governance and shareholder structure (see Section 2.2.2.6 – “Universal Registration Document”).

This Regulation, most of the provisions of which have only applied since July 2019, also provides for the establishment of a simplified prospectus, or “EU Growth prospectus”, drawn up on the basis of condensed versions for registration documents and securities notes, in the form of responses to a standardised questionnaire for SMEs listed on unregulated markets (including new “SME growth markets”)(203) and for small offerings of non-listed companies.

Moreover, in June 2018, the European Commission published two proposals for regulations amending the Market Abuse and Prospectus regulations with regard to promoting the use of SME growth markets; these proposals aim to increase the number of listings on SME growth markets and to enable issuers listed on these markets to attract new investors.

However, certain provisions of Regulation (EU) 2017/1129 concerning the exemption from the obligation to prepare a prospectus have applied since July 20, 2017(204).

Furthermore, provisions on national thresholds below which a public offering does not require a prospectus to be drawn up will come into force on July 21, 2018:

• ■increasing the threshold to €8 million (compared with €5 million previously) over a 12-month period(205), beyond which it is necessary to establish a prospectus when securities are offered to the public;
• ■creating, for “direct” offers of unlisted securities not subject to the prospectus, an ad-hoc prospectus based on a simplified disclosure document(206). An AMF Instruction sets forth the procedures (i) for presenting this information in the form of a condensed disclosure document (document d'information synthétique – DIS), of which a template is provided in Annex 2 of the Instruction, (ii) for submitting the document to investors and making it available on the issuer’s website, if any, and (iii) for filing this document with the AMF by email(207). The issuers must send the DIS (and all promotional materials) prior to any public offering, in an electronic format via email to the following address: depotdis@amf-france.org.

Since Commission Delegated Regulation 2016/301 dated November 30, 2015(208) came into effect on March 25, 2016, prospectuses and attachments, or all other documents drafted as part of an exemption from issuing a prospectus, must be filed in electronic format. In this regard, AMF Instruction no. 2019-21 prescribing the methods for filing and publishing prospectuses, updated on April 29, 2021, sets out a framework for the electronic filing of universal registration documents, attachments and any relevant updates. The prospectus is filed on the "ONDE” extranet.

ESMA recently published a statement on the sustainability disclosures to be included in prospectuses(209) in accordance with article 6, section 1 of the Prospectus Regulation, which states that a prospectus shall contain the necessary information which is relevant. The information to be disclosed should be based on “financial materiality”. Sustainability-related disclosures published in an issuer's non-financial reporting (in the NFIS or, under the CSRD, the sustainability report) should only be included in prospectuses to the extent that they are material to an investor.

New developments are highlighted in red.

The financial communication policy of a listed company reflects the regulatory constraints described in the previous chapters, as well as the willingness of executives to regularly communicate with financial market players in a transparent, professional and responsive fashion. Executive management relies primarily on a dedicated internal Investor Relations team to achieve this. Investor Relations officers are responsible for addressing the financial community (which primarily includes financial analysts [shares, credit, socially responsible investing], portfolio managers, institutional and individual investors and regulators) on behalf of the company, and establishing a targeted financial communication policy, in accordance with the principle of equal and consistent treatment of information.

The aim of Investor Relations is to create a trustful relationship with the markets by being a reliable source and providing relevant information that assists both investors and management in their decision-making. Given the increasing constraints imposed by the regulatory authorities and the markets, Investor Relations plays a key role in implementing the company’s financial communication objectives by:

• ■ensuring that, through their contacts outside the company, market players optimally value the company over the long term by explaining its strategy, business model and operating environment as well as its performance from a financial and non-financial standpoint, which much be mutually coherent;
• ■acting as a central interface between market players and the company and its management as a way to provide useful market feedback and greater added value;
• ■ensuring that the Investor Relations culture is understood internally, notably regarding the management of inside information and the strict regulatory framework as a whole;
• ■ensuring consistency across all corporate communication channels.

Beyond the fixed dates, the financial communication calendar is particularly important and organised around much of the company’s activity; for example, the calendar of executive management (publications and travel), the board of directors (board meetings), accounting and management control reporting (analysis of figures), and even salespeople’s commission (based on revenue in their area). It therefore serves as a structural tool that needs to be planned carefully several years in advance.

Over the last decade, the reporting of annual and half-yearly results has accelerated, resulting in a concentration of publications within increasingly tight periods. And yet many companies still do not have a consolidation process allowing them to publish their results rapidly.

Current practice shows that a large number of major listed companies publish their annual results for December 31 year ends in February.

In 2023, 92% of CAC Large 60 companies published their 2022 results at the end of February (compared with 88% the previous year – source: Cliff benchmarks).

In practice, companies that issue quarterly financial statements publish first-quarter information around April 30, second-quarter information around July 30 and third-quarter information around October 30.

This calendar may be adapted in accordance with other factors including:

• ■scheduling needs of the company's management, analysts and the publication dates of other issuers, in particular those in the same industry;
• ■constraints imposed by time of day or other scheduling constraints (market opening times, bank holidays in any foreign countries in which the company is listed or has major shareholders, etc.);
• ■simultaneity with other events organised by the company or in which it is participating (trade shows, conventions, conferences organised by brokers, etc.);
• ■“logistical” considerations, such as the availability of service providers or meeting rooms.

As a result of the pandemic, significant changes have taken place, including a shift to virtual meetings for a period of several months. Earnings announcements sometimes take place exclusively online, with management teams no longer necessarily based at the same location. Although these meetings are accessible to all, it is difficult to measure their real impact or use them as an opportunity to build relationships.

Face-to-face meetings were partially resumed in 2022. At the same time, webcasts have become increasingly popular, with 83% of CAC 60 companies announcing this format in early 2023 in their annual results press releases and/or on their website.

In the specific case of companies with listed subsidiaries, it is important to ensure that all financial communication calendars are synchronised. As each case may be unique (depending on the degree of control of the subsidiary, its sector, its market capitalisation, free float or relative contribution to consolidated earnings), it is essential for information to be disclosed simultaneously, or for the listed subsidiary to disclose its information after the parent company. If this is not possible, notably in the case of a non-controlling interest, it is desirable to coordinate their financial communications, at the very least.

It may also be necessary to establish a specific communication calendar in addition to this periodic calendar, particularly for financial transactions. This specific calendar would be published in order to provide information on each stage of the transaction, including legal obligations, the approval of the board of directors and information obtained from employee representative bodies, etc.

As mentioned in Part 2, the AMF recommends that issuers publish their tentative financial communication calendar in their annual report and on their websites in a clearly identified section(1). To comply with good practices, this calendar should also be published in a press release.

In practice, the majority of issuers announce the full yearly calendar of periodic information months in advance on their website.

Furthermore, in the 2022 annual results press releases published by CAC 60 companies in early 2023, 67% of companies included a calendar that mentioned at least the date of the next periodic release (source: Cliff benchmarks).

The role of Investor Relations is not limited to the dissemination of quantitative data at regular intervals and in accordance with regulations. It is also responsible for identifying shareholder base as precisely as possible and then using its in-depth understanding of how the financial markets work and its knowledge of different players to identify particular investors who are most suited to the company’s strategy. Should any changes be made to this strategy, the targeting approach will be realigned accordingly. This approach should form part of a pro-active marketing strategy that covers the needs of investors and generally aims to:

• ■diversify the profiles of the issuer’s investors, with respect to the amount of capital they manage, their investment strategy or their geographical origin;
• ■create a healthy balance between stable shareholders and those with a shorter-term investment strategy, in order to contribute to the liquidity of the company’s shares;
• ■support strategic developments (sale or acquisition of business activities, diversifications, growth of a business that could have an impact on the value of the company, etc.) by adjusting the profile of the target investor;
• ■anticipate changes to the shareholder base that could affect the company’s development.

With this in mind, the implementation of an effective marketing strategy is intrinsically linked to the size of the issuer and its free float; internally, these two elements often affect the resources (number of employees, budget, etc.) allocated to investor relations and the availability of management to meet with members of the financial community (frequency of meetings, seniority of stakeholders, etc.); externally, and especially in the context of MiFID II, these factors tend to have a major impact on the coverage provided by analysts, i.e., the number of research and brokerage firms covering the stock value, and the quality of the coverage. Some stocks whose capitalisation is deemed too low to be profitable are covered by generalists at best, and not by industry specialists. Small caps require greater involvement from executive management as investors want to meet with them directly. Lastly, small caps are less likely to attract the interest of foreign investors, which often only follow the largest stocks included in leading indices, with the exception of companies that are market leaders or are present in niches that attract special interest, such as new technologies.

The ease with which shareholders are identified depends on whether the shares are primarily held in registered form (whereby the issuer knows the identities of the holders) or bearer form (whereby the identities of the holders are only known to their banks). In the first case, the share register provides detailed, complete and up-to-date information. For shares registered on a “pure registered” basis, the company ensures the provision of all custodial services. If shares are held in “administered registered form”, the management of the company’s shares is entrusted to a financial intermediary. In the second case (which is more common), more exhaustive and accurate identification of the company’s shareholders is not easily obtained. However, several sources of information remain available to the issuer:

• ■trading data: these data may be based on the analysis of the identifiable bearer shares requested by the issuer from Euroclear, the central clearing agency, at a particular period‐end, and which may be exhaustive or limited by thresholds governing the number of shares held by the ultimate shareholders or the financial intermediaries interviewed. This analysis was replaced in 2021 by the new InvestorInsight service in order to meet the requirements of the Shareholder Rights Directive II (SRD II, see below). Another available source of information is service providers, who may allow a company to understand more about its shareholder base using public information and/or specific surveys conducted with institutional investors (shareholder identification);
• ■regulatory and statutory data: the law provides companies with various possibilities for identifying their shareholders, such as through disclosures of upward or downward crossings of statutory and legal thresholds, as well as registration of shares, as mentioned above;
• ■empirical data: companies must exploit every opportunity to improve their familiarity with their shareholders, including through feedback after roadshows, analysis of proxies collected at shareholders' meetings, information received directly from investors at events such as one-on-one meetings, etc.

Listed companies should use a combination of these various tools to obtain a more detailed understanding of the composition of and changes to their free float (the proportion of share capital of a publicly-held company) and to gain a clear picture of the composition of and changes to their shareholder base. However, the proliferation of trading platforms that are not legally obliged to provide the same information as regulated platforms, and the significant increase in high frequency trading, render shareholder identification difficult. The information obtained in this way is never totally accurate. However, it provides the most detailed picture possible of the shareholder base at any given time.

The frequency of these analyses will depend on the situation of each issuer. For example, a large free float and a highly volatile share could demand multiple analyses over the course of the year.

Directive (EU) 2017/828 of May 17, 2017 on shareholder rights upholds the right of all listed companies to know the identity of their shareholders. Pursuant to this Directive, article L. 228-2 of the French Commercial Code (as amended by the PACTE law) provides that any issuer is entitled to request, at any time and in exchange for payment by the issuer, from either the central securities custodian or another intermediary or intermediaries as referred to in article L. 211-3 of the French Monetary and Financial Code, information about the holders of its shares and of any securities conferring immediate or future rights to vote at the issuer’s shareholders’ meeting. This option is automatically available to companies whose shares are admitted to trading on a regulated market; any contrary provision of their articles of association will be deemed invalid.

A decree specifying the list of shareholder information that must be provided was issued on November 27, 2019 and entered into force on November 29, 2019(17). The information includes the shareholder’s name or company name, nationality, year of birth or incorporation, postal address and, where available, email address, the number of shares held, any restrictions on the shares, the registration number for legal entities or national identifier for individuals, the date from which the shares have been held, the code indicating the shareholder’s principal activity, whether the shareholder qualifies as a professional within the meaning of article L. 533-16 of the French Monetary and Financial Code, and, for holders of units or shares in a UCI, the name and registration number of the distributor having assigned the units or shares to the holder(18). The same information may be requested for holders of registered shares whose identity is not known to the company, i.e., whereby the shares are registered with and managed by an intermediary.

The decree also specifies the deadlines for transmitting the information, which vary depending on the professional category of the party providing it. For example, account-keepers have ten business days from receipt of the request to transmit the information, while central custodians have just five days(19). Account-keepers must provide the information to the company, its representative or the central custodian, while the latter may only provide it to the company. The timeframe granted to intermediaries acting for one or more shareholders to respond to requests for information about registered shares is ten business days from receipt of the request(20).

According to the PACTE law, any charges levied for services relating to bearer shareholder identification must be non-discriminatory and proportionate in relation to the actual costs incurred for delivering the services. Providers of these services must publish the charges for each type of service on their website(21).

Law no. 2021-1308 of October 8, 2021 (law aligning French law with EU economy and finance law – the DDADUE 2 law) (i) introduces reforms to the procedure for identifying owners of bearer shares, and (ii) requires listed companies to inform their shareholders (if not directly) via their intermediaries (information on how shareholders can vote and notification that their votes have been taken into account). Decree no. 2022-888 of June 14, 2022 (on identifying shareholders, transmitting information and facilitating the exercise of shareholders' rights) sets out how to identify shareholders, transmit information between companies and their shareholders and facilitate the exercise of shareholders' rights, as well as the content of the information transmitted and the deadlines applicable to the above procedures. In this respect, readers can refer to the cross-reference table prepared by the French National Association of Joint Stock Companies, which summarises these items (ANSA, note no. 22-BR10).

While regulatory, periodic and ongoing financial information constitute the starting point from which investors forge their opinion of an issuer, investment decisions also take into account other important factors. As the first criterion for investors is confidence in the company’s management, executives and directors are increasingly involved in the company’s financial communication and in meeting investors. This can be challenging for small- and medium-sized companies. In 2019, the AMF observed that a majority of SBF 120 companies had appointed a contact person for communication between shareholders and the board of directors (mainly the lead director, if one has been appointed, or the chairman of the board of directors)(30). However, some companies persist in having their chairman and chief executive officer or their chief executive officer take on this role, assisted by their operations teams(31).

It is therefore the responsibility of Investor Relations to manage requests for meetings and assess their relevance in light of the executives’ many other commitments. Several criteria must be taken into consideration, such as the interest that the investor represents for the company, the size and the investment strategy of the institution to which the investor is affiliated, and the historical relationship.

For executives, the aim of these meetings is to:

• ■present the results of their strategy, ensure that it has been fully understood and identify the highlights of their company’s earnings;
• ■share their view of the macroeconomic and competitive environment with the investors;
• ■discuss more general current issues and respond to any questions emanating from the financial market community.

It is therefore vital that executives are well prepared, have liaised with Investor Relations to identify the key messages that they wish to convey to the financial community and to journalists, and that they prepare answers to questions (Q&A) relating to all subject matters, including the most sensitive issues, while scrupulously respecting the principle of equal treatment of information, in accordance with regulations. Explanations and answers must take into account all information that has been previously provided and anticipate, insofar as is possible, their future consequences.

To ensure consistency and credibility, it is important that the Investor Relations officer be present at meetings between executives and members of the financial community since they have an understanding of all the parties as well as how the financial markets work. This ensures that the relationship is managed more effectively over the long term.

The AMF emphasises that certain companies have appointed lead directors for climate change or directors with specialist climate-related expertise, who can therefore contribute to implementing financial communication.

For the majority of investors, meeting the company’s executives is an essential step in the decision-making process. Brokers offer to organise corporate access with executives as part of one-on-one meetings, roadshows, or subject-specific or general conferences. These meetings allow brokers to better position themselves in the eyes of investors and see an increase in stock market orders or favourable votes, by way of compensation.

However, the entry into force of the MiFID II Directive in early 2018, which establishes a clear separation between investment research and executing transactions, has significantly changed brokers’ and investors’ practices. Costs related to research, and related activities such as organising conferences, roadshows etc., must be itemised and kept separate from transactions, meaning that brokers have become more selective in their research. As a result of this provision, brokers, based on their trading policy, pass on the cost to clients and even reduce their monitoring of certain small-cap investments. In terms of corporate access, many issuers report difficulties in organising roadshows in certain destinations and receiving less relevant feedback. Some investors are choosing to use brokers’ services less frequently, preferring to set up their own corporate access teams to contact issuers directly. In turn, investors confirm that they are being directly approached by investors more frequently. Investors are now even organising conferences together (BlackRock, Fidelity, etc.) where they invite CEOs to speak exclusively about strategy. The first such conference is scheduled for end-November 2023 in London.

On January 27, 2020, the AMF published the results of its research(32) into the first visible impacts of MiFID II on research and corporate access. The report concludes that there has been a marked deterioration in the quality of research in the sell-side market, especially for small and mid-caps, and that there is a growing trend for funds to contact executives directly, without making use of brokers’ corporate access services, which is further reducing the visibility of small and mid-caps among investors.

“Market sentiment” includes investors’ and analysts’ perception of the strategy, activities, performance and outlook of the company and of the credibility of its management.

Investor Relations officers play a key role in reporting market sentiment upwards to executives. The challenge lies in recognising when analysts’ and investors’ individual opinions become a general, shared impression – through conversations, roadshows, emails, the publication of sector notes, etc. – which it shares with the company’s executive management, or even the board of directors or supervisory board.

Investor Relations officers must decide when and how to provide this information, which may depend on the topics and recipients concerned.

A corporate governance code for listed companies drawn up by the Association Française des Entreprises Privées (AFEP) and the Mouvement des Entreprises de France (MEDEF) business associations. This code summarises and sets out all principles ensuring the due and proper operation of, and effective transparency in, listed companies.