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Index of the companies enjoying good Corporate Governance

With regard to the decisions passed by the National Corporate Governance Commission, BSE published on its website a Corporate Governance Assessment Scorecard, which was adopted by the Commission.

The said Scorecard constitutes a tool to assist the companies where applying the basic principle of the National Corporate Governance Code: "comply or explain". Thus it enables the companies to carry out self-assessment on the extent, to which these implement the principles and recommendations set out under the Code in their operations.

As a result of the campaign undertaken by BSE to promote the Scoreboard, most of the companies which had declared observance of the National Code of Corporate Governance principles, presented a completed Scorecard to the Exchange. The data provided under the cards in question is to be used where selecting the companies in order to construct an Index of the companies having good corporate governance.

Based on the completed questionnaire and a quantitative examination undertaken in order to satisfy the predefined requirements on the companies’ liquidity, a number of interviews were conducted with those companies qualifying for inclusion in the Index. In the third quarter, the selection of specific companies to be included in the Index is forthcoming.

At its meeting in July, the National Corporate Governance Committee decided to make technical corrections in the methodology for calculating the index of companies with good corporate governance, and to identify the companies included in the index from the date of calculation.

CGIX (Corporate Governance IndeX) was chosen as a name of the index. It was also decided that the original technical calculation and the dissemination of the information will be made by the Bulgarian Stock Exchange-Sofia.

The index was defined to consist of seven (7) companies, weighted by their market capitalization adjusted for free float of each one of them. Its base value was set at 100 points and the date of calculation was determined on 09/19/2011.

According to the rules adopted to calculate the index, the included companies are subject to periodic review in June each year, while the coefficients of free-float are reviewed every three months by analogy with the indices of the Bulgarian Stock Exchange-Sofia.

According to the approved methodology for the selection of companies and after the provided further explanations and answers to specific questions from the governing bodies of the respective companies, the National Corporate Governance Committee has identified the following companies to be included in the index from the date of calculation to its next review in June 2012.

  1. Stara Planina Hold AD-Sofia
  2. Monbat AD-Sofia
  3. Sopharma AD-Sofia
  4. Industrial Holding Bulgaria AD-Sofia
  5. Corporate Commercial Bank AD-Sofia
  6. Kaolin AD-Senovo
  7. Enemona AD-Kozloduy

After several tests the CGIX index was launched on 19.09.2011

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