FRANCE - The French pensions reserve found, the Fonds de réserve pour les retraites, is to launch a set of guidelines for corporate governance by the end of the year.

The supervisory board of the FRR, headed by Raoul Briet, has already presented a draft to the executive board, it emerged as the fund presented its 2003 annual report in Paris.

The executive board, headed by Francis Mayer, is in turn expected to present a draft of proxy voting guidelines to the supervisory board, the report says.

In a resolution in April 2003, the supervisory board stated "its desire that the FRR be actively involved in promoting good corporate governance practices in the companies in which the fund may invest".

Mentioning the proxy-voting draft, the FFR said it did not intend to use its influence as a shareholder to acquire representation on the boards of companies it may invest in. But it added: “The fund should aim to consistently exercise its right to vote at annual shareholders’ meetings."

The annual reports also says the FFR will incorporate regulatory requirements in force and company codes of conduct into the investment guidelines for the asset managers to which it awards mandates.

Aspects of corporate practice as disclosure, board composition and independence as well as the equal treatment of shareholders are mentioned as well.

"The supervisory board hoped that the process of selecting asset managers would serve as an opportunity to indicate how they intended to ensure that the FRR would be able to exercise its voting rights efficiently," the annual report says.

Commenting on the latest and final round of appointments of asset managers for the fund’s 16 billion-euro portfolio,
Mayer said the choice had been made through criteria relatively new in the country.

The FRR had made its choice as a long-term investor and had tapped a group of well-known international asset managers, he said.

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