The Organisation for Economic Co-operation and Development has published nonbinding guidelines to help policymakers improve the legal, regulatory and institutional frameworks governing listed corporate bonds. Covering issuers whose bonds trade on an exchange or other regulated venue, including companies without publicly traded equity, the guidelines complement the G20/OECD Principles of Corporate Governance through recommendations on disclosure, board responsibilities and bondholder rights. They do not cover unlisted bonds or broader creditor rights and insolvency frameworks. The guidelines call for timely disclosure of information material to bondholders, including covenant compliance risks and breaches, default events, collateral, changes in the use of proceeds and contractual triggers that may alter a bond’s economic characteristics. Reporting should follow internationally recognized accounting and disclosure standards, undergo an annual independent audit and be disseminated through channels that provide equal and timely access. Boards should oversee capital structure and bond issuance in line with corporate strategy and risk appetite, consider bondholder interests where relevant and take steps to minimize creditor losses when insolvency is imminent or unavoidable. Policymakers should also facilitate bondholder identification, communication, voting and participation in meetings, while supporting institutional investor engagement. Where trustees are used, they should be independent, competent, adequately resourced and accountable to bondholders, with duties to manage conflicts and monitor issuer compliance. The guidelines further recommend frameworks that facilitate out-of-court restructuring and equitable treatment, including safeguards against consent arrangements or position-enhancing transactions that disadvantage minority bondholders.
Organisation for Economic Co-operation and Development issues corporate governance guidelines for listed bond issuers
The Organisation for Economic Co-operation and Development has issued nonbinding guidelines for the governance of listed corporate bond issuers, including companies without publicly traded equity. The recommendations cover bondholder-focused disclosure, board oversight of capital structure and mechanisms for exercising bondholder rights. They also promote independent trustees, out-of-court restructuring and equitable treatment of bondholders.